For the first time in over a year, the share of Ginnie Mae loans with forbearance increased, according to a report from the Mortgage Bankers Association released Monday.
The percentage of government loans in forbearance rose to 1.32% as of Aug. 31 from 1.26%
Ginnie Mae backed securitizations of mortgages that other government agencies insure or guarantee have been under more strain than other types of home financing because they're typically made to serve more financially strained buyers.
"The overall number of loans in forbearance continues to trickle down, but there was an increase in Ginnie Mae forbearances in August," said Marina Walsh, MBA's vice president of industry analysis, in a press release.
Across all mortgage investor types, the share of loans in forbearance inched down to 0.72% from 0.74%. Mortgages backed by government sponsored enterprises continued to have the lowest forbearance rate at 0.32%, and loans in bank portfolios or private-label securities had the highest at 1.26%.
Interestingly, although the Ginnie forbearance exits, starts and re-entries during the month netted out to an increase, when resolved
The percentage of loans in Ginnie securitizations that were current at the end of August was 94.57%, up from 94.36% the previous month.
While mortgage performance in the Ginnie sector and across the board has been bearing up fairly well to date, Walsh said it could continue to be under increasing strain unless the rise in consumer costs
"There may be pressures on portfolio performance and post-forbearance workout performance in the months ahead — particularly for government loans — if the record-low unemployment rate rises and the personal savings rate decreases amidst high inflation," Walsh said.
