As the COVID-19 pandemic began to spread across the United States last spring and states announced shut downs, many Americans found themselves unemployed or underemployed. As a result, the federal government took swift action to provide mortgage payment relief by allowing homeowners to enter forbearance. A year later, as of March 2021, 2.5 million homeowners were still in forbearance, according to the Mortgage Bankers of America.
Realtor.com published an article, noting the opinions of experts who explain that, despite this alarming number of U.S. homeowners behind on payments, a potential foreclosure crisis is unlikely. In the article, reporter Sharon Lurye explains, the current housing market conditions are likely to provide a safety net for many of homeowners. Houses, in many parts of the United States, continue to be in high demand and the inventory remains low. Coupled with low interest rates, homeowners behind on payments, possible nearing the end of their forbearance, could still decide to sell the home for a profit. Additionally, as Americans getting their footing and learn to adjust to the current conditions, forbearance rates dropping nationwide.
Nevertheless, there are still areas of the country where homeowners are not only seriously behind on payments, but the housing market is not as strong due to weak economies and lack of employment. These homeowners will continue to need assistance by reaching out to their lender with the hopes of renegotiating the terms of their loan in a way that makes it feasible to make the payments. Still, some may decide to just sell and move to a rental property, assuming they can find a property to rend.
The good news, it seems that the U.S. isn’t headed toward a wide-spread foreclosure crisis, however there are Americans that continue to struggle and may for months and years to come.
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