In its weekly snapshot of forbearance activity, Black Knight reports an expected mid-month lull in activity. The number of active forbearance plans declined again this week, if only by 7,000, Tuesday to Tuesday. That marks a total 117,000, or -5.4% reduction from the same time last month.
As of June 15, 2.06 million borrowers remain in COVID-19 related forbearance plans. Broken down by type of loan, 2.3% of Fannie Mae and Freddie Mac-backed loans are in forbearance plans; 6.9% of Federal Housing Administration (FHA) and VA-backed loans are enrolled in forbearance programs; and 4.5% of portfolio/privately securitized mortgage loans remain in such plans.
While Fannie and Freddie and FHA/VA loans improved at a rate of -6,000 and -4,000, respectively, private/portfolio mortgages in forbearance rose by about 3,000.
Starts and exits both dipped during the week and removals were down 50% from the previous week, which the researchers at Black Knight say is typical mid-month behavior and month-end review cycles.
New plan inflow was near the lowest weekly rate since the onset of the coronavirus pandemic when Black Knight began tracking COVID-19 related forbearances, continuing the trend of gradual declines in start activity, the researchers report.
Those experts expect exits to increase toward the end of the month and to do so even more acutely in early July.
In the upcoming three weeks, some 400,000 plans are slated for quarterly reviews. That could lead to additional plan exits as the July 4 holiday approaches. And, added authors of Black Knight's latest report, "what happens in early July will largely dictate the outlook for later this year."
As the servicing industry preps for more forbearance exits, DS News facilitated a webinar  in which key players discussed their approaches and offerings for homeowners.
Panelists stressed that the No. 1 priority today is communicating with borrowers and keeping them in their houses. They cited possible options such as the Standalone Partial Claim, the Owner-Occupant Modification, the Combo Partial Claim and Loan Modification, and the FHA Home Affordable Modification Program.
"A big misconception for those not in the industry, and I deal with these customer calls on a weekly basis, they think in today’s environment, the servicer is out to foreclose and get their property back,” Ramie Word, SVP of Default Servicing for Mr. Cooper said. “We know that’s not the environment we are in. The number one priority is to keep the customer in the home. Being able to partner with the GSEs and CFPB speaks volumes to the differences between the financial crunch of 10-12 years ago to where we are at now. We are able to have a dialogue and get answers to grey area questions, so we are all marching down the same path together."