As we all watch mortgage forbearance numbers tumble, are we missing an opportunity? The forbearance peak in May of 2020 represented well over four million mortgages, so approximately the same number of homeowners. Here we are a full year later and we are at half of the forbearance volume, with BlackKnight reporting 2.2 million in forbearance, representing 4.2 percent of homeowners. Approximately 2.5 percent of these homeowners have mortgages with Fannie Mae or Freddie Mac, 7.4 percent have Federal Housing Administration (FHA) or Veterans Administration (VA) mortgages, and 4.8 percent represent portfolio or private-label securities (PLS).
You have to ask yourself where are those two plus million homeowners and how are they doing now? According to the Mortgage Bankers Association’s Mike Fratantoni, senior vice president and chief economist, those making payments, approximately 25.3 percent, are performing at near pre-COVID rates. As a mortgage servicer do you know who these homeowners are? This population called and queried their servicers non-stop starting in March of 2020. They were struggling to determine “what next” when they didn’t have confidence in their capacity to make mortgage payments and keep their home safe. For many homeowners, this was the beginning of a meaningful relationship with their servicer, and more than five hundred thousand are now performing with more to follow. This is an opportunity ripe with potential!
There are of course many more homeowners in forbearance, who will not be in a performing status for quite some time. “More than 47 percent of borrowers in forbearance extensions are past the 12-month (delinquency) mark as of the end of April,” according to Fratantoni. Forbearance and payment deferral options, as well as foreclosure moratoriums will dissipate, leaving these homebuyers in your default servicing queue. Servicers have however become extremely proficient in managing distressed borrowers, whether due to pandemic impact, natural disaster, or economic influence. As these homeowners modify and come current, they will join the performing loan group.
These are opportunities ripe with potential! Running a query on which homeowners have recovered from a nonpayment or delinquent status for three or more months, and then connecting with them in a meaningful way is how you build a “Client for Life”. It is also a method for instilling consistent payment habits going forward, minimizing complaint scenarios, and building rapport and referrals. HomeBinder represents a simple process for executing meaningful engagement with these homeowners, and:
- Is easily implemented and offered to homeowners.
- Provides a tech-savvy, forward-thinking benefit.
- Legitimately helps your clients become better homeowners.
- Exemplifies their importance to you as a client…. for life.
HomeBinder is a value-add for the servicer. It creates a constant self-serve touch point for your portfolio of homeowners, while it educates and encourages the homeowner to maintain the collateral. A digital platform that replaces old school file folders, notebook binders and even shoe boxes that homeowners have historically used to store the essential documents tied to their home. Homebinder replaces this antiquated approach to home management and much more – It is a gift that says “thank you” for your business and forges a sophisticated relationship between the servicer and homeowner. Bringing together a collaboration of home service professionals, HomeBinder builds valued relationships amongst the parties that interact with homebuyers, from servicers to insurance providers. This partnership is leveraged to promote personalized customer engagement at minimal cost to the servicer. At the same time the servicer is able to offer homeowners a valuable automated support platform that extends throughout the homeownership lifecycle, not solely the life of the loan.
As forbearance numbers continue to drop, make sure you have not overlooked a key segment of your portfolio. Connect with us today to find out more about this revolutionary approach to homeowner engagement and retention. Visit us at www.homebinder.com, or contact us directly at 800.377.6915.
HomeBinder ● Expected by Homeowners ● Driven by Lenders