Vast Majority of Mortgage Forbearances are Going to Those Who Don't Need Them

[Anonymous]

With the number of homeowners under forbearance plans nearing 10% of all of those having a mortgage, a survey indicates that most of those borrowers did not actually need the help. One quarter of the homeowners surveyed said they had applied for forbearance because of a COVID-19 hardship, and of those, 80% were granted one. However, only 5% said they wouldn't have been able to pay their mortgage without forbearance.

See the full article at the link below.

http://www.mortgagenewsdaily.com/05202020_covid_19_forbearance.asp 

[Anonymous]

Yep and the numbers are likely a lot higher for credit cards. 

This is why assistance programs aren't usually offered - because people abuse it. 

[Anonymous]

It's unfortunate that people who can afford it abuse the system. I'm sure taking a forbearance is going to bite a few people when the bill comes due. 

[Anonymous]

I think there are many people in the "just in case" camp. Haven't been financially impacted by COVID, but it has them shook up about their cash reserves / emergency fund. Hopefully they are learning a lesson here. Putting the money in the bank and not buying a new jet ski.

[Anonymous]

What's stopping creditors like AMEX, Chase etc.. from using this to chop a credit line as a precaution? Anyone think this is possible or already happening?

[Revelate]

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@Anonymous wrote:

What's stopping creditors like AMEX, Chase etc.. from using this to chop a credit line as a precaution? Anyone think this is possible or already happening?

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Some lenders are already doing it.  Amex has pared back a few forum members but really any more than pre-COVID.  Sync and Commenity seem to be more voracious.

I am just in a bad mood today reading the news: people wasting stimulus payments and people taking forbearance their don't need.  Social programs not working because people suck and even I'm getting angry and cynical enough to come off my typical stance and no longer take what I thought was the right road in not accepting handouts as I didn't need it.

[CreditCuriosity]

Reading the news has been raising my blood pleasure recently.  People not going back to work as they are making more than when they use to be employed at a "decent" wage for their job, etc..  Can't wait till end of July comes for those that CAN work, but choose not to for obvious reasons..

[Anonymous]

I'm not sure how people are making more not being at work, then again I'm not eligible for unemployment due to having a second job even though I make less now. Though you touch on a subject i never thought we would ever reach, being paid to not work. A jobless society sounds like it might be cool and all, but what would a person do all day?  This especially would be useless in a pandemic situation because what's the use of having time and Money, if you can't go anywhere due to a lockdown.

As for the article, I'm not understanding the benefit of this for people who don't need it. After all it has to eventuallly be paid back at some point, because it's not forgiveness of any debts. It's merely a deferment program, right? What's worse is someone who would openly say that they didn't need it. IDK, I guess that I just don't get the mindset. 

I guess as long as someone else who does actually need it and can get it then there's no harm done.

[Anonymous]

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@Anonymous wrote:

I'm not sure how people are making more not being at work, then again I'm not eligible for unemployment due to having a second job even though I make less now. Though you touch on a subject i never thought we would ever reach, being paid to not work. A jobless society sounds like it might be cool and all, but what would a person do all day?  This especially would be useless in a pandemic situation because what's the use of having time and Money, if you can't go anywhere due to a lockdown.

As for the article, I'm not understanding the benefit of this for people who don't need it. After all it has to eventuallly be paid back at some point, because it's not forgiveness of any debts. It's merely a deferment program, right? What's worse is someone who would openly say that they didn't need it. IDK, I guess that I just don't get the mindset. 

I guess as long as someone else who does actually need it and can get it then there's no harm done.

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Unemployment benefits for everyone were hiked $600 a week. For lower income workers, they're making more money on unemployment than they would be working so they have no incentive to go back to work. If anything it seems more like this was a test to see what a universal basic income would do to work ethic because I can't think of any other good reason for paying people a bonus for not working. It would have been very easy to say they would match your income up to $600 beyond basic normal unemployment benefits and have an exception for tipped employees.