A ‘Tidal Wave’ of Evictions and Defaults Looms This Summer
June 4, 2020 (EIRNS)—With over 45 million Americans out of work, and the government’s $600-a-week unemployment insurance bonus slated to end in late July, the prospect of a tidal wave of loan defaults and evictions now looms over the country. Millions upon millions of auto loans, credit cards, and mortgage payments are already late and many non-performing (90 days overdue), but creditors have by and large not moved for collection of those debts because of a combination of private and government forbearance plans.
“The measures adopted by Congress to provide leniency to those unable to pay debts, have kept impending financial disaster at bay for millions of people,” National Public Radio (NPR) reported today. “But that may not last for long.” TransUnion, the credit bureau, reported that some 3 million auto loans and 15 million credit card accounts are in some kind of program to let people skip or make partial payments. An additional 4.75 million homeowners—or 9% of all mortgages—have entered into forbearance plans.
When these various plans expire, all of the back debt will be due.
“Evictions are likely to go through the roof,” one housing activist told NPR. Another group, Panameño, conducted a national survey that found that “25% of Latinos had already fallen behind with their payments; 28% of African-Americans had fallen behind. That compares to 12% of whites that had fallen behind.”