Trump Relief Program, what is happening
Didier Malagies • April 10, 2020
Mortgage Forbearance , what is going on?
Mortgage Forbearance Requests Jump Nearly 2,000% As Borrowers Seek Relief During Coronavirus Outbreak
Source: CNBC
Written by: Diana Olick
Mortgage payments for the month of April are not even officially late until the 15th, but borrowers are flooding into the government’s mortgage forbearance program.
Forbearance requests grew by 1,270% between the week March 2 and the week of March 16, and another 1,896% between the week of March 16 and the week of March 30, according to numbers released Tuesday by the Mortgage Bankers Association. It includes data on 22.4 million loans serviced as of April 1, almost 45% of the first lien mortgage servicing market.
The Cares Act, which President Donald Trump signed March 27, seeks to limit the economic damage from COVID-19. The government implemented the mortgage relief measures before Trump signed the bill. It mandates that all borrowers with government-backed mortgages — about 62% of all first lien mortgages according to Urban Institute — be allowed to delay at least 90 days of monthly payments and possibly up to a year’s worth. Those payments must ultimately be remitted either at the end of the loan term or in a structured modification plan.
For the week of March 23 through March 29, caller requests numbered 218,718. That number jumped to 717,577 requests in the following week, according to a Mortgage Bankers Association calculation. Mortgage servicers are required to grant forbearance to any borrower who requests it with no documentation of hardship necessary.
Among the loans sampled, from March 2 to April 1, total loans in forbearance grew from 0.25% to 2.66% of total servicing portfolios. Ginnie Mae loans in forbearance had the highest volume and grew most significantly from 0.19% to 4.25%. These loans, which represent FHA and VA loans, generally have lower down payments and are granted to borrowers with lower credit scores.
It is also getting more difficult for borrowers to get through to their mortgage servicers to make these forbearance requests. Call center average speed to answer reached 17.5 minutes from under 2 minutes three weeks ago. About 25% of borrowers are abandoning the calls compared with 5% three weeks ago.
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That Redfin data point—$13 trillion in housing wealth held by Americans 70+—is a big deal, and it ties into several powerful trends reshaping the housing and mortgage markets. What’s driving this record wealth? 1. Long-term home price appreciation Older homeowners bought decades ago at much lower prices and have benefited from massive appreciation, especially post-2020. 2. Low mortgage leverage Many in this age group either: Own their homes outright, or Have very small remaining balances So their equity = real wealth , not just paper gains. 3. Aging in place Instead of downsizing, many are staying put longer, allowing equity to continue compounding. Why this matters (big picture) 1. Supply constraint in housing Fewer older homeowners are selling, which: Keeps inventory tight Supports higher home prices This is one reason younger buyers are struggling to find affordable homes. 2. Wealth inequality across generations Younger generations: Face higher home prices Have less access to equity Meanwhile, older Americans control a disproportionate share of housing wealth. Implications for mortgage and lending 1. Rise of equity-based lending This trend directly fuels growth in: Reverse mortgages (HECMs) HELOCs Cash-out refinances That $13T is largely untapped liquidity . 2. “Living off equity” becomes more common With concerns around: Social Security stability Inflation More retirees are using housing wealth as: Income supplementation Emergency reserves 3. Intergenerational wealth transfer We’re seeing more: Parents helping kids with down payments Early inheritance strategies using home equity The hidden risk This isn’t risk-free: If home prices flatten or fall → equity shrinks Property taxes + insurance (especially in places like Florida) can pressure fixed-income retirees Liquidity is still “locked” unless accessed strategically Bottom line That $13 trillion figure isn’t just a stat—it represents a shift in where wealth lives in America : Housing is now the primary balance sheet asset for older Americans It’s becoming a retirement tool , not just a place to live And it’s quietly shaping everything from housing supply to lending innovation  Didier Malagies nmls212566 DDA Mortgage nmls324329
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