The Mortgage Bankers Association's Research Institute for Housing America reported that more than six million households failed to make a rent or mortgage payment in September 2020. The RIHA recently conducted a study titled, Housing-Related Financial Distress During the Pandemic, in which it found that during the third quarter, the percent of homeowners and renters behind on their payments decreased slightly from the second quarter. That being said, the overall amount remains high.
According to the report, 8.5% of renters (2.82 million households) missed, delayed or made reduced payments in September 2020. Additionally, 7.1% (3.37 million homeowners) missed their mortgage payment.
"Rent and mortgage payment collections improved over the summer as more people went back to work, but high unemployment continues to place hardships on millions of U.S. households. There is growing concern that absent a slowdown in the number of coronavirus cases and another round of much-needed federal aid, millions of households in the coming months face the prospect of falling further behind," said Gary V. Engelhardt, professor of economics in the Maxwell School of Citizenship and Public Affairs at Syracuse University. "With the current eviction moratorium expiring in January, the situation could be even more challenging for renters. Many renter households across the country could find themselves with no place to live and no means to repay missed payments."
Meanwhile, the number of students who missed a student loan payment remained steady at 40%, however, this could have an impact on the future of the housing industry as Engelhardt explains.
"The tens of millions of student debt borrowers behind on their payments also has future ramifications for the housing and mortgage markets. Borrowers ending up in default would see an adverse effect on their credit, in turn making it potentially more challenging for them to rent or qualify for a mortgage," said Engelhardt.
Read more from the MBA's RIHA study.
