MBA Chart of the Week: Completed Loan Workouts from 2020 and Onward: % Current (Jan 24, 2025)

According to the latest results from MBA’s Monthly Loan Monitoring Survey released this week, approximately 235,000 homeowners are in forbearance plans as of December 31, 2024. This level is substantially lower than the peak of almost 4.3 million homeowners in June 2020 and the 8.5 million borrowers who have been provided forbearance since March 2020.
Over the past five years, many homeowners have exited forbearance and entered a post-forbearance loan workout – either a repayment plan, a stand-alone payment deferral/partial claim, or loan modification. Altogether, 6.41% of serviced loans (3.2 million homeowners) are in a loan workout as of December 31, 2024.
This week’s MBA Chart of the Week shows the non-seasonally-adjusted performance of loan workouts initiated in 2020 and onward. Total completed loan workouts that are current (not delinquent or in foreclosure) on their mortgage payments as a percent of total completed workouts decreased to 65.39% in December 2024, down 88 basis points from 66.27% the prior month and down 900 basis points from one year ago. While all product types show weakening in performance year-over-year, Fannie/Freddie conventional loan workouts are performing the best at over 78% current, representing almost 4 out of 5 borrowers with a Fannie/Freddie loan workout. The workout performance of other loan types – particularly FHA loans – is lower. The change in performance since last year is also more pronounced for FHA and other government loans compared to conventional loans.
In contrast, total loans serviced that were current as a percent of total servicing portfolio volume (#) is still relatively strong at 95.05% in December 2024, down 17 basis points from 95.22% the prior month and down 39 basis points from one year ago. Borrowers with existing post-forbearance workouts – particularly borrowers with government workouts – appear to be more susceptible to hardship in making mortgage payments.
Note: Total completed loan workouts for the purposes of this analysis include repayment plans, loan deferrals/partial claims, loan modifications. Reinstatements are excluded.
  • Repayment Plan: Past due amounts are added on to existing mortgage payments over several months, in order to bring the existing mortgage current. As a result, borrower monthly payments to servicer may increase from pre-pandemic payment levels until past due amounts fully paid.
  • Payment Deferral/Partial Claim: Payments that were not made by the borrower are moved to the end of the loan term to be paid upon home sale, refinance, or at maturity. This allows the borrower to resume making their regular monthly payments as before, without needing to “catch up” on missed payments.
  • Modification or Combo (Modification and Payment Deferral): A permanent change is made to the terms of an existing loan in order to make monthly payments more affordable and allow the homeowner to stay in their home. It may involve a reduction in the interest rate, an extension of the length of time for repayment, and/or a different type of loan or loans.