One million homeowners are at risk of losing their homes because they haven’t taken advantage of an option that protects them from foreclosure or eviction.
Homeowners with federally guaranteed mortgages can temporarily hold off on their monthly payments for up to a year without penalty, as long as they make those payments up later. In order to do so, borrowers must call their mortgage company to ask for forbearance.
However, many homeowners have simply missed payments, according to the Wall Street Journal.
Over one million borrowers are at least 30 days past due on their mortgages and not in a forbearance program, according to mortgage-data firm Black Knight Inc. Of those, 680,000 have federally guaranteed mortgages and therefore qualify for a forbearance plan. While the rest do not, some lenders may have offered forbearance regardless.
Some experts expect that number to grow to several million as the six-month point of those forbearances approaches in October. While an extension is possible, homeowners must once again request it.
The mortgage relief program was put into place in the early phases of the coronavirus pandemic as part of the CARES Act, but homeowners don’t need to prove they’re experiencing financial difficulties to take advantage. But according to a July report from the National Housing Resource Center, more than half of borrowers surveyed either were not aware of the forbearance program, or were confused about how it works.
“Some borrowers are falling through the cracks that we’re not picking up,” Lisa Rice, president and chief executive of the National Fair Housing Alliance, told the Journal. “It’s just a really sad series of events.” [WSJ] — Sasha Jones