CFPB Reviews Borrowers' Experiences with COVID Mortgage Forbearance Program

The CFPB assessed the experiences of borrowers who attempted to access mortgage loan "loss mitigation programs" in effect during COVID-19. 

In the Report, the CFPB analyzed data from the 2020 American Survey of Mortgage Borrowers ("ASMB"). The CFPB focused on distressed borrowers who "experienced difficulties making payments on their loan."

The CFPB found: (i) "almost half" of borrowers either believed they did not qualify for forbearance or were unaware of how to apply for forbearance. Over a quarter of borrowers did not apply because the "application process was too much trouble;" (ii) borrowers with limited English proficiency were more likely to report being distressed, although the differences were not statistically significant; and (iii) over a third of distressed borrowers were unclear about repayment options for paused mortgage payments or "what would happen at the end of the forbearance period."

The CFPB concluded that "the complexity of processes for receiving help with payment difficulties may have created barriers to accessing loss mitigation for some borrowers." The CFPB noted that "[m]any respondents who received temporary forbearance on their loans were satisfied with the experience, but many remained unclear about what would happen and how they would make up deferred payments when they exited forbearance." The CFPB stated that "communication with servicers appears to play an important role for distressed borrowers to get the help they need."