The COVID pandemic of 2020 is leaving a lasting scar on the economic landscape of the nation and the lives of tens of millions in the U.S. alone. According to the U.S. Bureau of Labor Statistics (Bureau of Labor Statistics – Unemployment Rate) the overall unemployment has recovered substantially from the peak 2020 unemployment of 14.8% in April 2020 to 6.7% in December 2020. Unfortunately, the damage has been done and many homeowners have been forced to accept a forbearance agreement to defer their mortgage payment.

The CARES Act put into place forbearance plans to allow homeowners to remain in their homes and defer their monthly mortgage payments for a limited time, typically up to 180 days. For more information see our blog on May 13, 2020, Forbearance and Mortgage Rates. As of today, nearly three (3) million households remain in a forbearance plan and although nearly 30% of those in forbearance have continued to stay current on their payments, many have not.

Yanling Mayer, Principal Economist at CoreLogic, recently revealed:

“A distributional analysis of forborne loans’ payment status reveals that more than one third (39.1%) of all forborne  loans are now 150+ days behind payment, while as many as 1-in-4 (25.5%) are 180+ days past due.”

These homeowners were given permission to defer their payments, but the question now is: how many of them will be able to catch up after their forbearance program ends? Some, particularly those with federally backed loan programs, i.e., FHA, VA, USDA, Fannie Mae and Freddie Mac, which is nearly half of all residential mortgages, may be able to restructure their loan and place the deferred payments at the end of the loan with an extension of the term. However, others with a private mortgage may find that the entire deferred balance must be paid at the end of the deferment period to reinstate the loan with foreclosure imminent if the loan is not broad up to date. There is considerable speculation that a forthcoming wave of foreclosures could be the result as, despite the positive unemployment figures, there are many homeowners relying on two incomes with only one in the household back to work.

What are the experts saying?

Over the last 30 days, several industry experts have weighed in on this subject.

Michael Sklarz, President at Collateral Analytics:

“We may very well see a meaningful increase in the number of homes listed for sale as these borrowers choose to sell at what is arguably an intermediate top in the market and downsize to more affordable homes rather than face foreclosure.”

Odeta KushiDeputy Chief Economist at First American:

“The foreclosure process is based on two steps. First, the homeowner suffers an adverse economic shock…leading to the homeowner becoming delinquent on their mortgage. However, delinquency by itself is not enough to send a mortgage into foreclosure. With enough equity, a homeowner has the option of selling their home, or tapping into their equity through a refinance, to help weather the economic shock. It is a lack of sufficient equity, the second component of the dual trigger, that causes a serious delinquency to become a foreclosure.”

Don LaytonSenior Industry Fellow at the Joint Center for Housing Studies of Harvard University:

“With a greater cushion of equity, troubled homeowners have dramatically improved options: a greater ability to access funding (e.g., home equity lines) to keep paying monthly expenses until family finances might recover, improved ability to qualify for and support a loan modification, and, if push comes to shove, the ability to sell the home and monetize their increased net worth while reducing monthly payment obligations. So, what should lenders and servicers expect: a large number of foreclosures or only a modest increase? I believe the latter.”

Given the generally positive equity situation many homeowners are in, they should be able to use a loan modification or refinance to stay in their homes. If not, some will go to foreclosure or short sale, but most will be able to sell and walk away with their equity.

Won’t the additional homes on the market impact prices?

Distressed properties (foreclosures and short sales) typically sell at a significant discount to market. If homeowners sell instead of going into foreclosure, the impact on the housing market will be much less severe. If there is a silver lining to this rather gloomy “forbearance cloud” it may well be the unprecedented lack of inventory on the market. Just last week, explained: “Nationally, the number of homes for sale was down 39.6%, amounting to 449,000 fewer homes for sale than last December.”  

As indicated in the accompanying infographic the home inventory in Dallas County has continued to steadily decrease which has allowed prices to steadily appreciate upward of 17% adding substantially to homeowner equity!  

According to, the market has the potential to absorb half a million homes this year without it causing home values to depreciate.

Bottom Line

The pandemic has led to both personal and economic hardships for many American households. The overall residential real estate market, however, has weathered the storm and will continue to do so in 2021.

The housing market in north Dallas, Tarrant, Denton and Collin counties remains extremely active with many buyers due to the influx of large firms relocating into our area. This is resulting in many homes selling above the listing price. In fact, we recently negotiated the sale of one of our listings at $15,000, or nearly 5% above the listing price with six (6) simultaneous offers. This is truly a “hot” market for sellers.


If you are in a mortgage forbearance and wish to discuss your options:

Contact Geni at469-556=1185 or for a no obligation phone consultation!

Geni is a native Texan and has spent her life in the Dallas/Fort Worth Metroplex as a professional real estate agent. Her reputation is impeccable, and she has personal contacts across literally thousands of brokers and agents in throughout the area. Geni and her Team know how to SELL, what works and what doesn’t! She has a proven track record of selling homes faster and for a higher price than most agents, even in the very difficult markets! With Geni and her Team on your side you can be assured of the most professional and successful marketing strategy. With Geni Manning’s credentials, knowledge, and decades of experience; she is a true Master of Real Estate.