Black Knight will release the latest numbers surrounding forbearance on Friday.
Volumes of forbearance plans have flattened, according to the latest data from Black Knight [1]. As of May 26, 4.76 million homeowners are in forbearance plans, with a net increase of just 7,000 new forbearance plans since last week.
At these levels, mortgage servicers need to advance a combined $3.6 billion a month to holders of government-backed mortgage securities on COVID-19-related forbearances. That’s on top of the $1.5 billion in T&I payments they must make on behalf of borrowers.
P&I advance payments have been capped at four months for servicers of GSE-backed mortgages. Given today’s number of loans in forbearance, servicers of GSE-backed loans still face up to $8.8 billion in advances over that four-month period.
According to a survey from LendingTree [2], most homeowners who have been approved for a mortgage forbearance may not need one. Of the 25% of homeowners surveyed that applied, 80% were approved for a forbearance. However, while the majority of people who applied were approved, only 5% said they wouldn’t have been able to pay their mortgage without forbearance. Another 72% of those who received forbearance reported feeling at least a little guilty about it.
The nationwide delinquency rate hit its highest single-month increase in history in April, according to the First Look at April mortgage performance data from Black Knight. According to Black Knight [3], some 3.6 million homeowners were past due on their mortgages as of the end of April (including the roughly 211,000 who were in active foreclosure)—the highest number since January 2015.
This is an increase of 1.6 million since March, the largest single-month jump on record. This number includes homeowners past due on mortgage payments who are not in forbearance, as well as those currently enrolled in forbearance plans and who did not make an April mortgage payment.
The national delinquency rate nearly doubled to 6.45% from March, the largest single-month increase ever recorded, and nearly three times the previous record for a single month from back in late 2008. Delinquency increases in Nevada (+5.2%), New Jersey (+5.1%), and New York (+4.9%) led the states, while Miami (+7.2%), Las Vegas (+6.2%), and New York City (+5.4%) topped the 100 largest metro areas.
Here's what else is happening in The Week Ahead:
Construction spending (June 1)
Unemployment Rate (June 5)
U.S. Banking Committee Hearing on CARES Act (June 2)