Mortgage Industry News
« Return to Mortgage Industry News
Non-Agency Loans are in Need of Forbearance Assistance Too
Monday, August 31, 2020
A
recent posting on the Urban Institute's (UI's) Urban Wire blog touched on six facts
about the mortgage forbearance option mandated by the CARES Act for homeowners
with federally backed mortgages. Some information came from weekly surveys by
the Mortgage Bankers Association (MBA) and Black Knight and have been covered
extensively here. These include the basis stats; 7.5 percent of all mortgages were
in forbearance as of early August, a percentage that has dropped steadily from
8.9 percent in early June. The share of GSE loans in plans was 5.19 percent,
Ginnie Mae (VA/FHA) loans 10.06 percent and the largest share at 10.12 percent
was among loans serviced for portfolio lenders or private label securities
(PLS). That last number is significant
as PLS are not covered by the CARES Act, a situation that will be covered later
in this summary. The article, written by UI analysts Jung Hyun Choi and Daniel Pang includes information from the
U.S. Census Bureau's Household Pulse Survey which found racial disparities in
the financial impact of the COVID-19 on the ability to manage mortgage
payments. The
most recent Census survey, conducted in mid-July, found nearly 21 percent of both Hispanic and Black households had
missed or deferred the previous month's mortgage payment, compared with 10
percent of white homeowners and about 13 percent of all homeowners with
payments due. This gap persisted over the duration of all survey weeks, as
Black and Hispanic homeowners continue to be disproportionately burdened by the
pandemic's impact on employment and financial stability.
Read Full Article