Around 6% of outstanding first-lien mortgages in June 2020 were reporting zero payment due based on credit bureau data, up from essentially none in February—thus indicating some kind of coronavirus-related payment relief, the Consumer Financial Protection Bureau said in a report today. As would be expected, mortgage assistance was more likely to be reported in areas correlated with health and economic effects of COVID-19, including areas with greater shares of virus cases, greater shares of minority populations and higher levels of unemployment shock.
Credit card borrowers also reported receiving assistance at more than twice the normal levels, although the share reporting payment relief was edging down in June. Access to credit card loans remained relatively strong, with credit limits falling by less than 0.1%, principally for super-prime customers with already-high limits. While credit limits flattened for prime and near-prime borrowers, the pre-COVID upward trend in limits did not change for subprime borrowers.
And while financial institutions did close existing lines of credit and halt credit limit increases for open accounts, “these effects are very small in magnitude,” with “many of the account closings . . . on cards that were closed for inactivity,” the bureau said. As with other loan categories, credit card loans were less likely to go into delinquency post-COVID.