About 3.5 million mortgage borrowers have had their payments paused or reduced as the novel coronavirus outbreak in the United States continues to throw millions out of work, a survey from the Mortgage Bankers Association showed on Monday.
The share of mortgage loans in forbearance rose to 6.99% from 5.95% from April 13-19, the industry lobbying group said. The number of new requests for relief fell relative to the prior week but were still 100 times greater than in early March, MBA said.
Ginnie Mae loans grew the most from the prior week, up 1.47%, and they also had the highest percentage of loans in forbearance by investor type, at 9.73% of loans. For FHA and VA borrowers, the share of loans in forbearance stood at roughly 10 percent.
An unprecedented 26.5 million Americans have sought unemployment benefits since mid-March, erasing all the job gains made since the last recession.
More than 95% of Americans have been under “stay-at-home” or “shelter-in-place” orders to curb the spread of the virus, although several states have now begun to slowly reopen their economies against the advice of health officials.
MBA has called on the U.S. government to provide relief to the mortgage service industry. Federal Reserve officials have said they are monitoring the situation and may step in if the situation were to appreciably worsen.
“We expect forbearance requests will pick up again as we approach May payment due dates,” said Mike Fratantoni, MBA’s senior vice president and chief economist.
About 77% of the first-mortgage servicing market responded to the survey, the same as the previous period. They cover about 38.3 million loans.