The number of mortgages in active forbearance plans plummeted at the beginning of October, marking the biggest weekly decline in the last 12 months, according to This comes as a large number of balances were either marked for review or designated for final expiration in September. The number of weekly active forbearance plans decreased by 177,000 during the first week of October, the Black Knight's active forbearance report showed. This was led by a drop of 84,000 in FHA and VA loans, 50,000 among GSE loans - or loan backing from Fannie Mae and Freddie Mac - and 43,000 in privately backed loans.
If your forbearance plan ended but you're struggling to resume your mortgage payments, a mortgage refinance may be right for you. By reducing interest rates, you can save hundreds of your monthly payment. Many owners remain in forbearance, foreclosures are also on the rise.
While the number of forbearances is falling, 1.5 million homeowners, or 2.6% of all active mortgage holders, are in mortgage forbearance, Black Knight's data showed. But 180,000 of these forbearances could be removed at end review dates in September, and would soon end in the coming weeks. Another 420,000 plans are also scheduled to be revised for extension or expire in October.
However, data shows that foreclosure activity is also increasing after the end of the latest foreclosure moratorium. Consequently, certain plans could resume forbearance because their period has expired, rather than being financially ready to exit payments.
Foreclosure filings increased from August to September and 102% annually in September, according to the latest foreclosure report from ATTOM Data Solutions.
So far, Government and the mortgage industry have worked together to do an extraordinary job of preventing millions of unnecessary foreclosures using the foreclosure moratorium and mortgage forbearance program, said Rick Sharga, executive vice president of RealtyTrac, an ATTOM company. But there are hundreds of thousands of borrowers planned for in the next two months to default on their loans and it s possible that we might see a higher percentage of those borrowers default on their loans. If your forbearance period is able, but paying your mortgage is still difficult, you could consider taking out a mortgage refinance to reduce your monthly payments. Check out Credible for multiple lender interviews at once and choose the one with the best rates for you. Some programs may even allow homeowners to refinance if they missed payments due to the coronavirus pandemic.
HOUSING EXPERT: Although data shows that foreclosure rates are rising significantly, they remain well below pre-pandemic levels and are likely to stay there for the entire year.
Despite the increase in foreclosure activity in September, Sharga said that we re still far below historically normal numbers. November foreclosure actions were almost 70 percent lower than they were prior to the COVID - 19 pandemic in September of 2019, and Q 3 foreclosure activities were 60% lower than the same quarter that year.
Even with similar increases in foreclosures over the next few months, we ll end the year significantly below what we would see in a normal housing market, he said.
If your home is in default and you can't make payments after the end of your forbearance, there are several options available to pay back the mortgage or any unsecure debts. Homeowners can talk to their mortgage servicers to determine what repayment options they have, such as a loan modification. There are also several alternate options available for mortgage relief, such as payment deferral, a lump sum payment or even adding missed payments to the end of the loan.
Homeowners can also consider a mortgage refinance to lower their regular monthly payments. If you are interested in this option and want to get your mortgage questions answered, contact us.
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