US RMBS Loan Delinquencies Remain Stable; Foreclosures Edge Upward

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Fitch Ratings-New York-15 July 2022: Borrowers continue to work with their servicers post-forbearance to avoid loan default, according to Fitch Ratings’ 1Q22 U.S. RMBS Servicer Metric Report.

“Loan portfolio delinquencies for both bank and non-bank servicers remained stable in the first quarter of 2022 from the fourth quarter of 2021 and improved in certain categories,” said Fitch Structured Finance Director Richard Koch. Bankruptcy filings and 60+ day delinquencies have remained stable while 90+ day delinquent accounts have declined to 5% from 7% and 4% from 5% quarter over quarter for bank and non-bank servicers, respectively. The sole metric showing stress is in the foreclosure category, which rose marginally to 2% from 1% and to 3% from 2% for bank and non-bank servicers, respectively.

Bank servicers reported an increase in loan modifications quarter over quarter to 38% from 24%, while repayment options, including cures, and active forbearance plans declined quarter over quarter as borrowers exited forbearance plans. Non-bank servicers, however, saw loan modification volume increase slightly to 21% from 20%. Other exit strategies, such as short sales and deed-in-lieu of foreclosure, account for 26% of monthly loss mitigation workout volume, a small increase from the previous quarter.

Fitch-rated servicers inform us that expectations of a large-scale foreclosure crisis has been largely abated by the variety of workout assistance options available to borrowers and the unprecedented home equity, estimated at $3.8 trillion nationwide, that borrowers can tap into as a safety valve. Additionally, servicers advise that the $9.961 billion Homeowner Assistance Fund (HAF) offered by the U.S. Treasury Department and administered by individual states has provided substantial assistance to homeowners emerging from forbearance plans and various foreclosure moratoriums nationwide as they seek to avoid default.

Fitch-rated servicers reported other key performance trends:

— Bank and non-bank servicers both reported a decrease in contract and temporary employees, with bank servicers reporting a 50% decline quarter over quarter while non-bank servicers reported a slight decline in already much lower numbers. Full time bank servicing employees rose while non-bank servicer staff decreased quarter over quarter.

Fitch’s U.S. RMBS Servicer Metric Report is published quarterly with the most recent four quarters of servicer performance data included. The report provides transparency into servicing industry trends in the bank and non-bank sectors. It also allows users to compare data metrics across servicers, revealing strengths and weaknesses in performance during this critical time in the industry.

Fitch rates mortgage servicers and publishes focused reports highlighting individual entities, which are available at


Richard Koch
Director, Structured Finance – RMBS
Fitch Ratings, Inc.
Hearst Tower
300 W. 57th Street
New York, NY 10019

Michael Laidlaw
Director, Structured Finance – RMBS

Adena Bernot