More than 6 million households did not make rent or mortgage payments while 26 million student loan borrowers missed loan payments in September, according to research by the Mortgage Bankers Association’s Research Institute for Housing America (RIHA).
A total of 8.5 percent of renters, or 2.82 million households, missed, delayed or made a reduced rent payment while 7.1 percent, or 3.37 million homeowners, missed their mortgage payment in September, according to the study.
The number of student debt borrowers who missed a monthly payment has stayed consistent at 40 percent since May.
“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,” Gary Engelhardt, Professor of Economics in the Maxwell School of Citizenship and Public Affairs at Syracuse University, wrote in the report.
“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,” Engelhardt said. “With the current eviction moratorium expiring in January, the situation could be even more challenging for renters. Many renter households across the country could find themselves with no place to live and no means to repay missed payments.”
RIHA’s findings were derived from a household survey from the Understanding America Study (UAS), an online panel survey of over 8,000 households analyzing economic data on the financial consequences of the pandemic by following the same households from before the pandemic through the end of September.
Three percent of renters were receiving unemployment benefits at the beginning of April, and that metric increased to 7.0 percent by the end of September. Mortgagors receiving unemployment benefits remained at 3 percent from the beginning of April through the end of September. Student debt borrowers receiving unemployment benefits started at 3.0 percent at the beginning of April and rose to 8.0 percent by the end of September.
The number of renters and homeowners able to make payments during the third quarter of 2020 improved slightly from the second quarter, but remained relatively high overall. While rental property owners lost as much as $9.2 billion in third-quarter revenue from missed rent payments, 13.0 percent of renters received permission from their landlord to delay or reduce their monthly payment.
Eleven percent of renters missed one payment over the second and third quarters, 4 percent missed two payments, 2.8 percent missed three payments and 3.8 percent missed four or more payments.
Meanwhile, 4.7 percent of mortgagors missed one payment across the second and third quarters, 2.0 percent missed two payments, 1.5 percent missed three payments and 4.2 percent missed four or more payments.
During the third quarter, missed mortgage payments were estimated to be as much as $19.4 billion.