As more people go back to work and can pay their bills during the COVID-19 shutdowns, mortgage holders’ requests for loan forbearance has slowed considerably as well, according to Housing Wire’s Kathleen Howley.
Howley quotes mortgage data firm Black Knight, who says, “Requests for help from borrowers have slowed with the total number of mortgages in forbearance at about 4.8 million. Only 7,000 mortgages entered forbearance this week.”
She reports that volumes of forbearance plans have flattened, while incoming applications have slowed to a relative trickle, with the overall share of home loans with suspended payments standing at 9%, according to her source.
“Broken out by investor types, 7.2% of mortgages backed by Fannie Mae and Freddie Mac are in forbearance,” Howley writes. “That’s a total of 2 million mortgages.”
At this week’s level for all types of mortgages in forbearance, loan servicing firms are faced with advancing a combined $3.6 billion a month in principal and interest payments to holders of government-backed mortgage securities on COVID-19-related forbearances, the report said. This is in addition to the $1.5 billion in payments for taxes and insurance they are required to make on behalf of borrowers, where these payments traditionally have come out of a mortgage holder’s escrow fund they pay into every month.
While jobless claims once meant layoffs affecting 1 in 4 American workers, the data showed some workers have been rehired.
“Continuing claims that measure the total number of people receiving unemployment benefits declined for the first time since the start of the pandemic,” says Howley.