The number of American homeowners unable to keep up with their mortgages in a pandemic-stricken economy continued its relentless rise, according to the latest report from the Mortgage Bankers Association (MBA).
The MBA reported Monday, May 4, that 7.54% of the loans in mortgage servicers' portfolios were now in forbearance, a 7.9% jump from the previous week's 6.99%, itself 16.7% up from 5.99% the week before. That figure was 0.25% on March 2, meaning forbearances have risen 2,916% in two months.
And while the pace of growth has slowed, that doesn't mean the bottom has been reached. "With millions more Americans filing for unemployment over the week, the level of job market distress continues to worsen," MBA senior vice president and chief economist Mike Fratantoni said in the MBA's weekly update.
"That is why we expect that the share of loans in forbearance will continue to grow, particularly as new mortgage payments come due in May," he said.
Ginnie Mae loans cross 10% line
Based on survey data that covered from April 20 to 26 and represents almost 77% of the first mortgage servicing market, about 3.8 million homeowners are now in forbearance plans that allow them to delay payments, the MBA said.
Among investor-backed mortgage loans, Ginnie Mae had the highest share in forbearance at 10.45%, the MBA said. Fannie Mae and Freddie Mac loans in forbearance grew from 5.46% to 5.85% for the week.
Depository servicers, such as credit unions and banks holding loans in their own portfolios, were at 8.41%, and independent mortgage bank servicers had 7.13% of their loans in forbearance, the trade group said.