A promising sign of a setback in the pandemic-ravaged economy has stalled: Fewer lenders are resuming mortgage payments.
The share of homeowners deferring mortgage lending gradually declined from June to November, an indication that people are returning to work and that the economy is starting to recover. But the decline has largely flattened since November, when the current wave of coronavirus cases in communities across the country increased.
Over the past two months, the group of homeowners has risen to about 5.5%, according to the mortgage association. Although it is below a peak of 8.55% in June, some economists are worried about the irritating tolerance – and they are worried that it could even start to climb if the economy shakes jobs.
Other data point to a slowdown in the U.S. economy this winter, and greater pressure on household finances. Employers cut their jobs for the first time since spring last month. The number of jobs has declined, and claims for unemployment insurance remain high. Retail sales fell for three consecutive months.
“With declining recovery and more applications for unemployment claims, we’re likely to see greater demand for tolerance,” said Ralph McLaughlin, chief economist at Haus, a home finance firm. “One of the guarantees people have when they own a home is to ask for their patience.”