MBA: 6.2M Households Miss Mortgage or Rent Payments in September; 26M Student Debt Borrowers Miss Loan Payments
WASHINGTON, D.C. — More than 6 million households missed a mortgage or rent payment in September, according to the Mortgage Bankers Association’s (MBA) Research Institute for Housing America (RIHA). The number of homeowners who missed a payment last month stood at 3.4 million, or 7.1 percent of all U.S. homeowning households. The number of renters who missed, delayed or made a reduced payment was 2.8 million, or 8.5 percent of U.S. renters. Additionally, the number of renters receiving unemployment insurance rose from 3 percent in April to 7 percent at the end of September. For mortgagors, the figure was unchanged at 3 percent over the same time period.
“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,” says Gary Engelhardt, professor of economics in the Maxwell School of Citizenship and Public Affairs at Syracuse University. “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.”
Furthermore, the RIHA found that 26 million individuals missed a student loan payment in September. According to Washington, D.C.-based MBA, the rate of borrowers missing loan payments (40 percent) has been steady throughout the pandemic.
“The tens of millions of student debt borrowers behind on their payments also has future ramifications for the housing and mortgage markets,” adds Engelhardt. “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.”