Business & Investment

“The share of mortgages in tolerance will drop to 3.76%.”

Along Calculated risk of July 12, 2021 04:00:00 PM

Note: This is as of July 4th.

From MBA: Mortgage share in tolerance drops to 3.76%

According to the latest Forbearance and Call Volume Survey of the Mortgage Bankers Association (MBA), the total number of loans currently in grace period has decreased by 11 basis points from 3.87% of the servicer’s portfolio volume last week. 3.76% as of July 4, 2021. The MBA estimates that 1.9 million homeowners have plans for tolerance...

Fannie Mae and Freddie Mac’s tolerant loan share fell 8 basis points to 1.91%. Mortgage mortgages Genie May Loans decreased 32 basis points to 4.78%, and portfolio loans and own-brand securities (PLS) mortgages increased 2 basis points to 7.94%. The percentage of delinquent loans for independent mortgage bank (IMB) services also decreased by 13 basis points to 3.87%, and the percentage of delinquent loans for deposit servicers also decreased by 13 basis points to 3.98%.

Mike Fratantoni, Senior Vice President and Chief Economist, MBA, said: “New demands remain very low, especially for Genie May loans, which continue to be affected by overdue loan buyouts, resulting in a significant decline in the share of overdue loans. These loans have been significantly reduced after the buyout. It will be tracked as a portfolio loan. ”

Fratantoni said: “The mortgage delinquency rate for the entire service portfolio fell in June compared to May. However, the delinquency rate for homeowners who completed training increased slightly. Borrowers are likely to have been bailed out for more than a year, and nearly 60% of borrowers have extended their grace period by more than 12 months. You may face more challenges. ”

Emphasis added

Click the graph to see the enlarged image.

This graph shows the percentage of portfolio tolerance by investor type over time. Most of the increase was from late March to early April 2020, and has been on a downward trend since then.

The MBA states: “Weekly total tolerance request as a percentage of service portfolio volume remained unchanged at 0.04% from the previous week.”

Caution: Postponement plan It’s very popular. Basically, when a homeowner ends his tolerance, he simply reverts to his normal monthly payments, no unpaid interest is charged, and his unpaid balance is deferred until the mortgage ends.

“The share of mortgages in tolerance will drop to 3.76%.” “The share of mortgages in tolerance will drop to 3.76%.”

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