18
FORBEARANCE
PLAN EXPIRATION
LOOMS FOR MANY
A report from Black Knight reveals the
most recent mortgage loan performance
trends, related details, and what it could mean
for future delinquency rates.
At the current rate of incremental
improvement, for another 17 months, the
national delinquency rate would remain
elevated. On top of that, for serious
delinquencies to bounce back to pre-
pandemic levels, almost five more years would
be needed. Meantime, the country remains on
pace to still have almost 1.5-1.6 million excess
seriously delinquent mortgages in the market
as March hits the rearview mirror.
By the looks of things, March appears
to be an inflection point for the mortgage
market. At that point—assuming no
additional action—24% of all forbearance
plans are set to hit their 12-month, and final,
expirations.
Early on in the pandemic, half of
homeowners utilizing forbearance continued
to make monthly mortgage payments. at
rate has descended steadily and now stands
at 12%. A reasonable assumption: additional
obstacles in returning to making payments
still could be encountered by many borrowers
still in forbearance for the full 12 months
potentially could face a larger challenge in
returning to making payments.
"For the roughly 6.7 million Americans
who have been in COVID-19 related
mortgage forbearance at some point since the
onset of the pandemic, the programs have
represented an essential lifeline," said Black
Knight Analytics President Ben Graboske.
"e vast majority of plans have a 12-month
cap on payment forbearance, though. And
the various moratoriums which have kept
foreclosure actions at bay over the past 10
months may be lulling us into a false sense
of security about the scope of the post-
forbearance problem we will need to confront
come the end of March. Last year saw the
largest number of homeowners – nearly 3.6
million – become 90 or more days past due
since 2009, and as of the end of December,
2.1 million remained so."
Journal
