CFPB Reports on Mortgage Servicing Experiences During COVID-19 Pandemic

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The most common problems distressed borrowers had during the COVID-19 Pandemic reflect difficulty accessing loss mitigation programs, the Consumer Financial Protection Bureau reported last month.

“Almost half of distressed respondents reported that they did not think they qualified for a program or that they did not know how or where to apply for programs,” CFPB said in a new report, Borrower Experiences with Mortgage Servicing During the COVID-19 Pandemic. “More than one-quarter of distressed respondents reported that the application process was too much trouble.”

The report used data from the 2020 American Survey of Mortgage Borrowers to analyze distressed borrower experiences during the pandemic. The ASMB is a survey sample derived from the Federal Housing Finance Agency National Mortgage Database.

The report found that more than one in five distressed respondents reported speaking a language other than English at home and around one in 15 reported both speaking a language other than English at home and speaking English less than very well. CFPB said the survey estimates reflect similar shares to national statistics on households with limited English, suggesting a prevalence of borrowers with limited English proficiency.

“Among distressed respondents who received forbearance, more than one-third were unclear about what would happen at the end of the forbearance period and how to repay suspended payments,” the report said.