Forbearances surged this week after three straight weeks of declines, according to Black Knight’s latest data, erasing about half of the improvement logged since forbearances peaked in late May.
The real estate analytics company’s McDash Flash Forbearance Tracker shows an increase of 79,000 forbearances compared to last week, with 4.68 million homeowners with forborne loans as of June 23. That figure makes up about 8.8% of all active mortgages, up from 8.7% from last week.
All those forborne loans represent $1.025 trillion in unpaid principal. About 6.9% of all loans backed by Fannie Mae and Freddie Mac and 12.5% of loans issued via Federal Housing Administration (FHA) or Department of Veterans Affairs (VA) programs are currently in forbearance. Among loans in private label securities or within banks’ portfolios, some 9.6% are forborne.
FHA/VA loans saw the largest increase in forbearances, with 42,000 entering forbearance programs over the last week of Black Knight data. Approximately 25,000 government-sponsored enterprise (GSE) loans and 12,000 non-agency loans entered forbearance over the same timeframe.
At the current level, mortgage servicers would need to advance up to $3.5 billion per month to investors on coronavirus-related forbearances, not including up to $1.4 billion in property tax and insurance payments that must be made on behalf of borrowers.