Single borrowers versus coborrowers in the pandemic: Mortgage forbearance take-up and performance

Laurie Goodman and Jun Zhu

Journal of Housing Economics, 2023, vol. 59, issue PB

Abstract: Early in the COVID-19 pandemic, policymakers initiated a forbearance program—that allowed borrowers to pause their mortgage payments—to prevent a large-scale foreclosure crisis. Using detailed loan-level performance data, we study forbearance take-up and subsequent performance among two distinct group of mortgage borrowers: single borrowers versus coborrowers. We provide stylized facts that compared to coborrowers, single borrowers have lower incomes, lower credit scores, higher loan-to-value ratios and higher debt-to-income ratios and are hence more financially vulnerable. We find that single borrowers are more apt to elect forbearance, all else constant. We further find that forbearance had a stronger positive effect on helping single borrowers avoid or recover and exit delinquency than coborrowers.

Keywords: Housing; Mortgage Default; CARES Act; Forbearance; Covid 19; Single borrower/Coborrowers (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jhouse:v:59:y:2023:i:pb:s105113772200081x

DOI: 10.1016/j.jhe.2022.101909

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