A study by the Mortgage Bankers Association's Research Institute for Housing America found that 12.4% of homeowners missed loan payments in the second and third quarters, including 7.1% – an estimated 3.37 million borrowers – in September alone.
About 4.7% of borrowers missed a payment in the past two quarters, 2% two, 1.5% three, and 4.2% four or more. The third quarter moratorium totaled $ 19.4 billion in missed mortgage payments. The research found a slight improvement in the third quarter as more people returned to work. However, this may not be an indication of future credit performance as the uncertainty lies ahead.
"There is growing concern that without a slowdown in coronavirus cases and another round of much-needed federal aid, millions of households have the prospect of falling further behind in the coming months," said Gary Engelhardt, professor of economics at Syracuse University said in the report.
Black Knight's recent Forbearance Report illustrated a similar development. After the number of forbearance mortgages had decreased for most of the COVID era the week before, about 19,000 loans went into active forbearance plans in the seven days leading up to October 13. Black Knight predicts heightened borrowers' plight through 2021.
The coronavirus has had an even bigger impact on student rent and debt. The lack of rent payments amounted to $ 9.2 billion in the third quarter, according to the MBA Housing Report. In the second and third quarters, 11% of renters missed a payment, 4% two, 2.8% three, and 3.8% four or more.
Student loans cast an even bigger shadow, accounting for $ 29.5 billion in missed payments. Approximately 16.2% of student loan borrowers have missed a payment since April, 8.8% missed two, 7% three, and 22.7% four or more.
Mortgages, while not directly affecting mortgages, have secondary effects on the market.
"The tens of millions of borrowers who are in arrears with their payments also have a future impact on the real estate and mortgage markets," said Engelhardt. "Defaulted borrowers would adversely affect their loans, potentially making it more difficult for them to rent or qualify for a mortgage."