Black Knight: Uptick In Forbearances, Improvement Still Slow

Black Knight says the trend of mid-month increases in active forbearance plans we’ve been reporting on for some time continues in 2021, with the population of homeowners in such plans rising by 17,000 this week.  

According to the latest weekly snapshot of Black Knight’s McDash Flash daily mortgage performance data, 2.74 million homeowners were in active forbearance as of January 19. The population has been vacillating between 2.71 and 2.83 million since early November, when the country began seeing new coronavirus case spikes and resulting shutdowns.  

Removal rates have also slowed noticeably following the six-month point of forbearance plans. This suggests that those borrowers who remain in forbearance were likely more heavily impacted by the economic downturn and thus are less likely to leave such plans before the full allowable 12-month period runs down.  

The 2.74 million loans remaining in active forbearance represents 5.2% of all mortgage holders, including 3.3% of GSE loans, 9.4% of FHA/VA loans and 5.2% of portfolio-held/privately securitized loans. A weekly decline of 3,000 GSE loans in forbearance was more than offset by a 15,000 increase in plans among portfolio–held and privately securitized mortgages and a 5,000 increase among FHA/VA loans. 

Though the industry is a far cry from the peaks seen last summer as far as the total number of active forbearance plans, the rate of improvement continues to be relatively slow. Black Knight is seeing fewer new plan starts, with that number holding steady at the three-week average and down 30 percent from the same week in December. At the same time, plan removals remain weak, with this week recording the second lowest weekly removal volume observed to date since we began monitoring the situation in April.