CFPB analyzes effects of Covid-19 on the housing market
On March 1, the CFPB released a report, Housing Insecurity and the COVID-19 Pandemic, analyzing the effects of the Covid-19 pandemic on the housing market, particularly with respect to low-income and minority households. According to the Bureau, as of December 2020, more than 11 million households were overdue on their rent or mortgage payments, placing them at heightened risk of losing their homes to foreclosure or eviction as Covid-19 relief programs expire in the upcoming months. Of these households, the Bureau noted that Black and Hispanic households bear a disproportionate financial burden and “were more than twice as likely to report being behind on housing payments than white families.” Additional statistics include: (i) 2.1 million households are more than 90 days behind on their payments; (ii) roughly 263,000 families noted as being “seriously behind” on their mortgages (and not enrolled in forbearance plans) will have limited options to avoid foreclosure once relief programs end; (iii) an estimated 8.8 million tenant households are behind on their rent, with 9 percent of renters reporting that they are likely to be evicted in the next two months; and (iv) of the 2.7 million borrowers noted as being in active forbearance as of January 2021, more than 900,000 of these borrowers will have been in forbearance for more than a year as of April 2021. The Bureau noted most borrowers that have exited forbearance after six or fewer months “have been able to resume payments without any issue.” However, borrowers who have been in forbearance longer are more likely to have difficulties resuming payments.
In a blog post released the same day, acting Director Dave Uejio acknowledged that mortgage servicers and landlords have been working to help keep borrowers and renters in their homes, noting that “[m]ost mortgage servicers are working hard to engage with the record number of homeowners in forbearance and the many other homeowners struggling to make payments.”