True Stories: Hybrid, eNote and RON Implementation

Join expert panelists that will discuss the status of federal legislation, trends in digital adoption and how best to prepare your organization for the next generation of lending processes.

Spruce’s Patrick Burns on innovation in title technology

In the season finale of Housing News season 5, Spruce CEO discusses heightened investor interest in title tech, innovation and fintech adoption.

Top CFPB official “hates” QM rules, jeopardizing safe harbor

A top CFPB official in charge of the rule-making process has heavily criticized the agency's own qualifying mortgage rule, jeopardizing safe harbor.

Fraud risk factors at closing increased almost 90% last quarter

A variety of risk factors could be contributing to the drastic increase in wire and title fraud risk factors in mortgage and real estate closings – for example, compliance issues and an increase in transaction data errors.


Mortgage delinquencies expected to remain above pre-pandemic levels until 2022

But 41% of homeowners in COVID-related forbearance have successfully exited

Following previous natural disaster recovery patterns, mortgage delinquencies are not expected to return to pre-pandemic levels until March 2022, according to a report from Black Knight. If trends persist, the data service provider estimates once the first wave of forbearances hit their 12-month expiration in March 2021, there may be more than 1 million excess delinquencies.

According to the report, 90-day delinquencies typically peak around three to four months following a natural disaster, however, COVID-19 has put upwards pressure on serious delinquencies for five months now. That said, a chasm has widened between early stage delinquencies, which dropped 9% in August, and serious delinquencies, which saw a 5% gain in the same month.

Nevertheless, August’s upward tick marked the mildest increase in five months – suggesting 90-day mortgage delinquencies could be nearing their peak.

Looking ahead at September’s projected numbers, payment activity improved, with 88.9% of first-lien mortgage holders making their monthly payment compared to August’s 88.6% and June’s 87.5%. Black Knight estimates the overall national delinquency rate may fall in September if increased payment activity persists during the last week of the month.

LOs are only human — Tech is necessary to keep up with max loan volumes

Explore three steps that enable technology to work more efficiently, which helps drive profitability.

Presented by: Total Expert

Despite a slow recovery period, borrowers’ ability to pay hit a positive note in September as unemployment fell to a six-month low of 7.9%, according to the Labor Department. Nearly 45 million homeowners report tappable equity in their homes, the largest volume ever, and the average tappable equity is nearly $125k – an increase of more than $3,200 from last year. According to Black Knight, fewer than 1 million mortgage holders currently owe more than their homes are worth.

“American homeowners now have the most equity available to them in history. Of those in forbearance, just 9% have less than 10% equity in their homes, which offers both borrowers and lenders multiple options in lieu of foreclosure,” said Ben Graboske, data and analytics president at Black Knight.

As forbearance continues to create a safety net for many borrowers, only 6,000 foreclosure starts were reported in August.

Of the 6.1 million homeowners who have been in COVID-19-related forbearance plans, 2.4 million – roughly 41% – have since exited. Of those near two and half million, 1.8 million are currently performing, while another 363,000 – roughly 6% – have since paid off their mortgages in full, either through refinancing or the sale of their home. Of those who remain past due, 267,000 are in active loss mitigation with their lenders.

“Just 54,000 loans at present represent significant risk – having left forbearance, are past due and not engaged in loss mitigation efforts. Seventy percent of those were already delinquent in February, before COVID became a factor,” Graboske said.

Entering September, more than half of all active forbearances – a whopping 2.1 million – were set to expire within the month. Through the first three weeks, that number fell to 1.1 million as servicers navigate forbearance expirations. According to the report, 46% of active forbearances chose to extend their term.

The real litmus test in regards to consumer credit health will become apparent in the coming months when these safeguards begin to expire and consumers have less payment flexibility, said Matt Komos, vice president of research and consulting at TransUnion, in a September financial hardship report.

Leave a comment

Most Popular Articles

Mortgage forbearance drops to 4.36%, exits pick up steam

The downward trend of borrowers in forbearance picked up speed in the last week of April, falling 11 basis points to 4.36% of servicers’ portfolio volume.

May 10, 2021 By
3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please