The report highlighted the primary reasons why borrowers are seeking forbearance. Nearly 68.4% of homeowners in forbearance cited temporary hardships like job loss, divorce, disability, or the death of a family member. Another 25.9% attributed their need for forbearance to natural disasters, while only 5.7% of borrowers remain in forbearance due to ongoing financial impacts from COVID-19.
The stages of forbearance were also mixed. About 63.1% of loans were in the initial forbearance phase, while 20.7% were in an extension period. Additionally, 16.2% of borrowers had re-entered forbearance, including those who had received extensions.
Despite the rise in forbearance, the proportion of loans in good standing, those neither delinquent nor in foreclosure, remained stable. By the end of August, 95.76% of mortgage loans were current, a figure unchanged from July. However, this was 33 basis points lower than in August 2023, reflecting the broader impact of economic pressures.
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The states with the highest share of loans that were current included: Idaho, Washington, Colorado, Oregon, and California. On the other hand, Louisiana, Mississippi, Indiana, West Virginia, and Alabama recorded the lowest percentages of current loans.