Mortgage bankers report many missed payments
With the end of mortgage protections and the federal moratorium on evictions no longer in place, a “substantial” number of people are defaulting on their housing payments, according to the Mortgage Bankers Association.
As The Ascent reported on Monday (December 20), the Association says 5.43 million households missed their mortgage or rent payments in October, up from 4.7 million the previous month.
Digging further, this means the percentage of homeowners missing mortgage payments fell from 3.2% in September to 3.8% in October, while 10.9% of tenants missed, delayed or made a rent payment. reduced in October, compared to 9.6% the previous month. .
The article notes that many households have still not recovered from the financial effects of the COVID-19 pandemic, which is contributing to the increase in missed payments.
Inflation only makes the problem worse, as Scott Sanborn, CEO of LendingClub, told PYMNTS’s Karen Webster last month.
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LendingClub’s research, conducted in conjunction with PYMNTS, found that the number of Americans living paycheck to paycheck is increasing, from 52% earlier in the year to 57% more recently. This is happening as a number of government support programs are in decline.
It’s important to note that even without government programs in place, there are some options for keeping a roof over your head, whether they are mortgage modifications – meaning your mortgage would be extended, reducing each. monthly payment – or refinance, which usually requires a decent credit score.
Renters can also try to work with their landlords to develop payment plans or negotiate reduced rents. As The Ascent noted, while landlords may start evicting again, it can be costly and time-consuming, meaning some landlords might want to make a deal rather than spend time trying to get their tenants out. .