CFPB Reports Show Data That Most Pandemic Mortgage Forbearances Prior To March 2021 Are Current Or Are Closed
CFPB Reports shows good news for homeowners with mortgage forbearance in March 2021. Homeowner in forbearance were either current or had their forbearance closed as of March 2023. The CFPB Office of Research released data confirming the information.
Congress passed the CARES Act in March 2020 in the wake of the Covid-19 pandemic. The CARES Act allowed millions of U.S. mortgage borrowers to enter public or private forbearance programs. These programs temporarily paused their mortgage payments.
Data from the CFPB database compares the performance of borrowers with forbearances in March 2023 to borrowers in March 2021. The CFPB had been vocal about its concerns regarding forbearance recovery. However, the data shows generally positive outcomes.
In 2021, CFPB found that mortgage delinquencies were most common among Black or Hispanic borrowers. These homeowners had an LTV ratio of 60% or higher. It also showed borrowers with mortgage delinquency rates lived in census tracts with lower relative incomes.
Among the loans in forbearance in March 2021 more than 52% were current as of March 2023. This is a much larger share larger than the 26% of loans that were greater than 60 days delinquent two years prior. As a result, the CFPB says the positive outcomes are clear.
The data showed the majority of borrowers with a forbearance in March 2021 were current as of March 2023. The data also showed that borrowers in forbearance in March 2021 were less likely of being delinquent or in foreclosure in the future.
Related research on CARES Act forbearances has illustrated that most borrowers became current either by self-curing or curing with assistance from repayment plans, deferrals or loan modifications.
The CFPB stated they will continue to monitor how mortgage borrowers are faring as the economic recovery from the COVID-19 pandemic moves forward.
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