1.2 Million Mortgagers Fear Losing Their Homes

More than a million mortgagers in a recent survey said they fear they are at risk of eviction or foreclosure or being forced to move in the next 30 days.

Mortgage Bankers Association's (MBA) Research Institute for Housing America (RIHA) Q4 2020 analysis showed, in particular, that 5 million households did not make their rent or mortgage payments in December, and 2.3 million renters and 1.2 million mortgagors said they feel they are at risk of eviction, foreclosure, or otherwise compelled to leave their homes.

The survey showed in December, 7.9% of renters (2.62 million households) missed, delayed, or made a reduced payment, while 5.0% (2.38 million homeowners) missed their mortgage payment.

Compared with previous periods, the data reveals the percentage of homeowners and renters behind on their payments has decreased since last year's third quarter.

"Gradual improvements in the labor market and economy helped more renters and homeowners make their housing payments at the end of 2020. However, the COVID-19 pandemic continues to cause financial stress for millions of Americans, and particularly for those who rent and have student loan debt," said Gary V. Engelhardt, Professor of Economics in the Maxwell School of Citizenship and Public Affairs at Syracuse University. "Despite 5 million renters and homeowners not making their December payment, fewer believe they are at risk of eviction, a foreclosure, or would be forced to move in the next 30 days. This confidence is perhaps an indication that direct checks and enhanced unemployment benefits, rental assistance, mortgage forbearance programs, and a federal eviction moratorium have so far been effective in keeping people in their homes."

One highlight from the study reflects how property owners are directly impacted by renters' ability or inability to make payments. "Property owners continue to play a key role in helping renters," MBA reported: 10.7% of renters missed one payment over the three quarters, 4.0% missed two payments, 2.7% missed three payments, and 5.4% missed four or more payments; 12% of renters received permission from their landlord to delay or reduce their monthly payment (by week); In aggregate, rental property owners lost as much as $7.2 billion in fourth-quarter revenue from missed rent payments. This was down from over $9.1 billion in the third quarter.

Added Engelhardt, "A rapid rollout of vaccines will hopefully slow the virus and lead to a larger reopening of the economy later this year. This would help the labor market and give affected households the opportunity to get back to work, resume their housing and student debt payments, and pay back past-due amounts."

The full study is available on MBA.org.