More Texas Homeowners Are Falling Behind in Mortgage Payments
As the COVID-19 pandemic drags on, more Texas homeowners are falling behind on their mortgage payments. Nationwide, more than 7% of homeowners with mortgages had missed at least one loan payment as of June, according to a new report from CoreLogic. The late loan rate was even higher in Texas’ largest metros, where almost 10% of Houston homeowners with loans have fallen behind in payments, and 8% of Dallas-Fort Worth residents with mortgages have missed at least one payment. The late loan rate in the D-FW area has almost doubled in the past year as the pandemic caused thousands of job cuts and some homeowners have deferred their mortgage payments.
“Three months into the pandemic-induced recession, the 90-day delinquency rate has spiked to the highest rate in more than 21 years,” Frank Nothaft, chief economist at CoreLogic, said in the report. Among the major Texas cities, Austin had the lowest late loan payment rate at 6.2%. Almost 9% of San Antonio residents with home loans were behind in their mortgages as of June. All the late loan counts include homeowners who stopped making payments under federal mortgage relief programs. Those homeowners will eventually have to make up their missed payments.
So far, the spike in late home loan payments has not caused a rise in foreclosures. Only 0.3% of home mortgages in D-FW were in foreclosure in June, CoreLogic researchers found. Nationwide, the foreclosure rate of 0.3% was actually down a fraction from June 2019 levels.
Analysts still worry that home foreclosures will surge as the pandemic and resulting recession continue into 2021. CoreLogic economists warn that serious mortgage delinquency rates could nearly double by early 2022, threatening millions of Americans with the loss of their homes. And a rise in foreclosures could put downward pressure on home prices if there is an increase in distressed sales.
“While federal and state governments work toward additional economic support, we expect serious delinquencies will continue to rise — particularly among lower-income households, small business owners and employees within sectors like tourism that have been hard hit by the pandemic,” Frank Martell, president and CEO of CoreLogic, said in a statement.
At midyear, metro areas that have seen huge declines in jobs and income from a lack of tourism and entertainment spending are suffering the largest late loan rates. In Miami, more than 13% of residential mortgage holders have missed payments. The late loan rate in New York is almost 12%, and in Las Vegas 1 in 10 homeowners with a loan have missed at least one payment...