Protections such as the CARES Act and continuous forbearance extensions have kept millions of families in their homes during the economic downturn, caused by the COVID-19 pandemic. However, a new report from the Consumer Financial Protection Bureau found that once these protections expire in the months ahead, more than 11 million families, close to 10% of U.S. households will be at risk of eviction or foreclosure.
The CFPB stresses urgency in the new report, stating that we have very little time to prevent millions of families from losing their homes. According to the report, the number of homeowners behind on their mortgage has doubled since the beginning of the pandemic—6% of mortgages were delinquent as of December 2020. Even more startling is the fact that more homeowners are behind on their mortgages today than in 2010 at the peak of the Great Recession. Another 2.1 million homeowners are 90 days or more behind on payments or "seriously delinquent." The number of those serious delinquent homeowners is five times the number of families that were in the category before the pandemic began.
Additionally, the CFPB reports that Black and Hispanic families are more than twice likely to report being behind on housing payments, compared to white families.
"I am deeply concerned that a mass wave of evictions and foreclosures will turn millions of families out on the streets. Such an event will not only be a humanitarian and public health disaster but will have repercussions throughout the housing sector and our economy at large," said acting CFPB director, Dave Uejio in the report.
"The CFPB was created in the aftermath of the 2007-08 housing crisis, and Congress uniquely equipped us to address the current looming housing crisis. Where we can use our authority to keep people in their homes, we will. Where we can coordinate public and private efforts to save homes, we will. Where we can prevent the weight of this crisis falling upon communities who are already struggling — whether they are Black, Hispanic, Native, rural, or lower-income — we will. And in those unfortunate instances where families can no longer stay in their homes, we will do everything we can to ensure that people are treated with dignity, families are able to preserve as much of their equity as possible, and everyone can make a smooth transition to other safe, secure, and affordable housing.
The CFPB is vowing to protect homeowners from unnecessary foreclosure and loss of wealth, make sure homeowners and renters have the tools they need, continue its work and understand the causes and cures of the housing insecurity crisis and listen to those whole are struggling.
Click here to read the full report.
