Only 5.7 percent of the single-family loans guaranteed by the GSE were in forbearance at the end of Q2, down from 7 percent at the end of the last quarter.

Fewer mortgages guaranteed by Fannie Mae were in forbearance at the end of the second quarter, another sign of a steadying housing market despite the ongoing COVID-19 pandemic.

Hugh Frater | Photo credit: Fannie Mae

As of June 30, 5.7 percent of the single-family loans guaranteed by Fannie Mae were in forbearance, down from the 7 percent that was in forbearance at the end of the first quarter, according to the company earnings released Thursday. The vast majority of the 972,000 loans in forbearance were related to COVID-19, according to the company.

“During this time of economic uncertainty, Fannie Mae is a force for stability, affordability, and liquidity in the housing markets,” Fannie Mae CEO Hugh Frater, said in a statement.

Much of the company’s focus in the second quarter was on mitigation measures to lessen the impact that COVID-19 had on homeowners, which included the suspension of foreclosures and foreclosure-related evictions, as well as eliminating late fees on homeowners in forbearance and offering payment plan and loan modification options.

“In the second quarter, we helped hundreds of thousands of homeowners and renters get the guidance and support they needed to stay in their homes, while we delivered on record refinancing demand,” Frater said. “Fannie Mae will continue to work with partners across the industry to fulfill our mission and our leadership role in housing finance.”

Overall, the government-sponsored entity reported a net income of $2.5 billion in the second quarter, a huge increase over the $461 million it reported in the first quarter of 2020 but lower than the $3.4 billion it posted in the second quarter of 2019.

The quarter-to-quarter increase was fueled by a decrease in credit-related expenses. In the first quarter, the company had set aside more money for loan losses due to COVID-19. That allowance remained mostly flat in the second quarter.

The company’s overall net worth spiked to $16.5 billion at the end of the second quarter, and per its conservatorship with the U.S. Department of the Treasury, Fannie Mae can retain quarterly earnings until its net worth hits $25 billion.

The data from Fannie Mae shows a steadying housing market, with fewer loans in forbearance and earnings returning closer to last year’s levels, after the first quarter’s significant drop-off. At the end of the first quarter, the company had advised that it expected the number of loans in forbearance to rise, but the opposite occurred.

Still, despite the positive news for the housing market, economic data from the U.S. Department of Commerce showed real gross domestic product in the U.S. dropped 32.9 percent in the second quarter.

Email Patrick Kearns

Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription