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THE MORTGAGE FORBEARANCE PROGRAM HAS ENDED, BUT WHAT DOES THAT MEAN FOR
WLANDLORDS
by Nicole Seidner, For Contemporary Information Corporation
ith Omicron finally peaking, more mask mandates at their ends, and not to mention people’s wits, many are finally starting to ask: what about the forbearance programs? The mortgage forbearance program
Landlords around the country know this is pretty rough. Despite a recent spike, there was sharp decline and no real improvement of employment rate during the pandemic. Thanks to the Great Resignation with workers citing not enough pay and the rising cost of living (Cost of living allowance and social security benefits rose 5.9% while consumer price index rose 7%), landlords have a great reason to fear that tenants will still be unable to pay their rents. While the forbearance helped keep those landlords safe with everyone unwillingly out of work during the “unprecedented” times, we’re now years in. It’s precedented. So, what’s next?
THE LOAN IS UP
Here comes the hard part. If your tenants still have not gotten jobs and seem to have no good alternatives to start paying their rents, you’re going to have a hard time coming up with ways to start climbing up out of the red. After your forbearance is over, you must repay what you missed on your mortgage bills. As forbearance isn’t forgiveness, landlords still owe all interest and the principal loan
provided so much relief during the pandemic and many landlords relied on it while tenants couldn’t pay their rent. However, many tenants still cannot pay their rent. If the program ends before those same tenants find sturdy employment, so begs the question: what happens next?
ALL ABOUT LOAN FORBEARANCE
According to DS News, anywhere between 3.8 to 4.2 million homes were in forbearance last year, with the program expiring this year. Forbearance was the major step in helping COVID-affected homeowners avoid foreclosure during the pandemic, and with it out of the way, many still need help. According to Forbes Advisor, 151,153 people filed for foreclosures in 2021 and the number was higher in 2020.
AMM1/6 APARTMENT MANAGEMENT MAGAZINE - MARCH 2022 67