Almost 3 Million Forbearances Already; Fannie Mae Predicts Short But Excruciating Downturn

Almost 3 Million Forbearances Already; Fannie Mae Predicts Short But Excruciating Downturn

Fannie Mae's April Economic Developments summary is, like Freddie Mac's, relatively optimistic only because they see the impact of the pandemic as being very short lived. However, in the interim, some of the numbers they forecast are hard to hear. In March, as the COVID-19 crisis loomed, Fannie's Economic and Strategic Research Group reduced outlook for economic growth over the entire year from 2.2 to 1.8 percent. They now expect it to contract by 3.1 percent. Much of the negative impact from the pandemic is expected in the current quarter and it will be a lulu, a reduction of 25.3 percent on top of a projected loss of 3.3 percent in Quarter 1. Based on an end to the social distancing orders in late May and a gradual resumption of business activity in June, there will be above average growth