There was a net decline of 1.6 percent in the number of mortgages in forbearance during the past week, a decrease of approximately 48,000 loans, as more plans that had expired at the end of January were processed out of the system. After the number of forborne loans declined by 45,000 the previous week, Black Knight had estimated there were about 47,000 more January expirations pending either removal or a three-month extension of their forbearance term.

The company, in its weekly report on COVID-19 forbearances, said the expirations driving the improvements over the past two weeks are of three-month terms. The maximum 12-month period would have begun to hit at the end of March. However, earlier this week the Federal Housing Finance Agency (FHFA) announced that borrowers in Fannie Mae and Freddie Mac (GSE) forbearance plans may be eligible for an additional extension of up to three months.

As of February 9, 2.67 million homeowners remained in forbearance, 5.0 percent of all mortgage-holders, and representing $532 billion in unpaid principal. Black Knight says this is the first time the number has dropped below 2.7 million since early April 2020.

There were declines across all investor types, the largest among loans serviced for bank portfolios and private label securities (PLS). A net of 30,000 loans, 4.4 percent of those loans left the program. Loans serviced for the VA and FHA had a reduction of 30,000 active plans or 1.1 percent and the GSE portfolio improved by 6,000 or 0.7 percent. As of February 9, there were 907,000 GSE loans, 1.114 FHA/VA loans, and 650,000 portfolio/PLS loans remaining in forbearance plans. These​ represent 3.3, 9.2, and 5.0 percent of those respective portfolios.

 

 

Black Knight says that it bears repeating that overall improvement in the number of active plans continues to be limited. Monthly declines have been averaging less than 2.0 percent since early December. The FHFA extension changes the landscape, of course, as roughly 30 percent of the remaining GSE forbearances had been set to expire at the end of March.  Should Ginnie Mae extend the FHA and VA plans to a maximum of 15 months and the current rate of improvement continues, there would still be some 2.5M homeowners in forbearance at the end of June when the first round hit of loans hit the new deadline.