Decline in Mortgage Forbearance Plans But Payments Drop Too
According to the McDash Flash Forbearance Tracker, as of June 2, 2020, 4.73M homeowners, representing 8.9% of all mortgages are in COVID-19 mortgage forbearance plans.
That’s down from 4.76M last week. The number of loans in active forbearance decreased by a net 34,000 over the past week, marking the first weekly decline since the CARES Act was enacted and the flood of forbearance requests began.
Black Knight CEO Anthony Jabbour Explains the Problem
"According to Black Knight’s McDash Flash Payment Tracker, far fewer homeowners in forbearance remitted May payments than did in April. If that trend holds true through the end of the month, the market should be prepared for another likely rise in the delinquency rate for May. Also, expanded unemployment benefits are scheduled to end on July 31. It remains to be seen how that will impact both forbearance requests and overall mortgage delinquencies.”
As of May 26, a significantly lower share of homeowners in forbearance had remitted May payments (just 22%) than did in April (46%), which suggests we’ll likely see another rise in the delinquency rate for May when the month’s full numbers come in in a couple of weeks.
In regard to unemployment benefits, please note that Continued Unemployment Claims Rise to 21.5 Million.
Before Covid-19 hit , there were less than 3 million people collecting unemployment. There are now 21.487 million.