Foreclosure Prevention, Refinance, and FPM Report — May 2020
August 18, 2020 / Source: FHFA
May 2020 Highlights — Foreclosure Prevention
The Enterprises' Foreclosure Prevention Actions:
- The Enterprises completed 83,756 foreclosure prevention actions in May, bringing the total to 4,534,370 since the start of the conservatorships in September 2008. Over half of these actions have been permanent loan modifications.
- There were 4,577 permanent loan modifications in May, bringing the total to 2,415,960 since the conservatorships began in September 2008.
- Nineteen percent of modifications in May were modifications with principal forbearance. Modifications with extend-term only accounted for 66 percent of all loan modifications during the month.
- Initiated forbearance plans dropped significantly from 989,594 in April to 392,338 in May. The total number of loans in forbearance plans at the end of May was 1,450,557, representing approximately 5.1% of the total loans serviced.
- There were 286 short sales and deeds-in-lieu of foreclosure completed in May, down 12 percent compared with April 2020.
The Enterprises' Mortgage Performance:
- The 30-59 days delinquency rate dropped to 2.53 percent, while the serious delinquency rate increased from 0.68 percent at the end of April to 0.86 percent at the end of May.
The Enterprises' Foreclosures:
- Third-party and foreclosure sales dropped 24 percent from 344 in April to 260 in May due to the suspension of foreclosures.
- Foreclosure starts also dropped from 3,229 in April to 2,316 in May due to the suspension of foreclosures.
May 2020 Highlights — Refinance Activities
- Total refinance volume increased in May to levels last observed in 2013 as mortgage rates fell in previous months. Mortgage rates decreased further in May: the average interest rate on a 30-year fixed rate mortgage fell to 3.23 percent from 3.31 percent in April.
- In May, 14 refinances were completed through the High LTV Refinance Option, bringing total refinances through the High LTV Refinance Option from the inception of the program to 46.
- The percentage of cash-out refinances decreased to 28 percent in May from 30 percent in April. Mortgage rates have continued to fall from the highs observed in 2018, creating more opportunities for non cash-out borrowers to refinance at lower rates and lower their monthly payments.