The mortgage industry has been working with homeowners who are looking for relief on their loans during the COVID-19 pandemic. To date, 2.9 million homeowners have found some type of relief. However, there are many others running into problems when trying to secure help.
Yesterday, NMP reported that Mortgage Bankers Association data that revealed the share of mortgages in forbearance jumped from 3.74% to 5.95%
. While the mortgage industry tries to get through the increasingly high number of requests, homeowners are reporting issues with securing relief. Some homeowners still fear getting help because they may have to pay all of the backlogged payments at once, according to an NPR report
. That being said, the report acknowledges there are other options when it comes to repaying these loans.
According to the report, mortgage companies reluctancy to provide help may be a sign that they, too, are in a desperate situation. Forbearance eventually trickles down to mortgage servicers who have to carry the payments when a borrower cannot. As this issue continues to arise, mortgage servicers are still looking for help at the government level.
"This is putting incredible stress on the system," says Michael Fratantoni, chief economist at the MBA. Fratantoni and fellow advocates have been lobbying
for the government to create an emergency source of funds so the mortgage companies don't run out of money, according to the NPR report. "Mortgage servicers are performing an essential function of the housing finance system," Fratantoni said.