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Financial Services Law Insights and Observations

CFPB highlights post-pandemic risks for renters

Federal Issues CFPB Covid-19 Consumer Finance Rental Assistance

Federal Issues

On September 17, the CFPB released a report revealing that renters and their families may experience “previously avoided economic harms of the Covid-19 pandemic as federal and state relief programs expire.” The report, which compared homeowners and renters using the CFPB’s Making Ends Meet survey and consumer credit data, found that, “on average, renters’ economic conditions were significantly more responsive to relief measures such as stimulus payments and alterations in unemployment benefits”, and are thus more susceptible to financial hardships as programs are ending. In comparing renters and homeowners, the report found, among other things, that: (i) renters are more likely to be Black or Hispanic, younger, and have lower incomes than homeowners; (ii) renters’ credit scores increased by 16 points during the pandemic, compared to 10 points for mortgagors and 7 points for other homeowners; and (iii) delinquency rates of renters with children experienced a considerable decrease after stimulus payments. According to CFPB acting Director Dave Ujeio, the Bureau “is committed to helping renters and their families thrive,” and “the modest gains renters made during the pandemic to ensure this nation’s full and equitable recovery from COVID-19.”

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