Borrower Experiences with Mortgage Servicing During the COVID-19 Pandemic

Abstract

Millions of mortgage borrowers had difficulty making their loan payments during the COVID-19 pandemic. The majority of these distressed borrowers had the opportunity to enter into extended forbearance programs that permitted them to temporarily stop making mortgage payments.1 Many were in contact with their servicers to access forbearance and to discuss other options to address payment difficulties. At the same time, some borrowers who had difficulty making their loan payments did not enter into forbearance or other loss mitigation even though these programs were available.

While existing research has examined the characteristics and demographics of mortgage borrowers during the pandemic,3 relatively little research has been conducted as to the experience of borrowers working with their servicer to access loss mitigation or other programs that were available during the COVID-19 pandemic. For example, some distressed borrowers may have had difficulty understanding the forbearance process while others may have entered forbearance with little or no difficulty. Evidence from servicer-provided data suggests that borrowers may have had varying experiences,4 but little is understood about how borrowers.