The Federal Housing Finance Agency (FHFA) released its first-quarter 2021 Foreclosure Prevention and Refinance Report, which showed Fannie Mae and Freddie Mac completed 224,646 foreclosure prevention actions in the first quarter, bringing the total number of homeowners who have been helped during conservatorships to 5.812 million, according to FHFA.
The report also showed that 38 percent of loan modifications completed in the first quarter reduced borrowers’ monthly payments by more than 20 percent. The number of refinances increased from 2.013 million in the fourth quarter to 2.016 million in the first quarter.
Freddie and Fannie’s serious delinquency rate dropped from 2.78 percent to 2.48 percent at the end of the quarter. This compares with 11 percent for Federal Housing Administration loans, 5.59 percent for Veterans Affairs loans and 4.7 percent for all loans (industry average).
Other highlights from the report include:
- Forbearance:The total number of loans in forbearance continued to trend downward since its peak in May as initiated forbearance plans decreased but remained elevated through the first quarter (compared with pre-pandemic levels). As of March 31, 2021, there were 660,039 loans in forbearance plan, representing approximately 2.2 percent of the Freddie Mac and Fannie Mae’s single-family conventional book of business, down from 804,559 or 2.8 percent at the end of the fourth quarter of 2020.
- Mortgage Performance:The 60-plus days delinquency rate decreased from 3.07 percent at the end of the fourth quarter to 2.68 percent at the end of the first quarter. The delinquency rate remained elevated as a result of the COVID-19 pandemic and the forbearance programs being offered to affected borrowers.
- Foreclosures:The number of foreclosures starts rose 45 percent from 6,302 in the fourth quarter to 9,125 in the first quarter.
- Real Estate Owned (REO) Activity & Inventory:Freddie and Fannie’s REO inventory declined 12 percent from 9,739 in the fourth quarter to 8,522 in the first quarter. The total number of property acquisitions increased 8 percent to 1,228, while dispositions decreased 19 percent to 2,445 during the quarter.