For now, at least, the number of lenient loans is going downhill and picking up speed. Black Knight says that The number of active plans decreased by 135,000 last month (-5 percent), 19,000 (-0.7 percent) occurred in the last week alone. As of March 23, there were 2.57 million indulgent loans, 4.9 percent of all active mortgages.
The company says the rate of decline this month is the sharpest since late November. Servicers have gone through 1.2 million plans that occurred in the month and are scheduled to expire by the end of the month. The month Black Knight compiled this week’s data had eight days left and 46,000 credits left to process. Providing the potential for additional improvement over the next few weeks.
The number of loans serviced for Fannie Mae and Freddie Mac (the GSEs) fell by 21,000 last week, and 10,000 fewer FHA / VA loans were still being planned. The number of forborne loans serviced for bank portfolios or PLS (private label security) investors rose by 12,000 to 676,000 or 13 percent of these loans. At the end of the reporting period, there were 837,000 GSE loans and 1.06 million FHA / VA loans left in forbearance. These figures correspond to 3.0 percent and 8.8 percent of the portfolio of these guarantors.
While the number of exits from plans has been sizeable, Black Knight points out that this was primarily a factor in the sheer number scheduled for review. 75 percent of the plans that expired in the past few weeks have been extended. The week’s report concludes, “Early renewal activity suggests service reps are continuing to move closer to the forbearance plans in three-month increments, with the majority of the possible March expiration dates extending through June.”