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The federal government CARES Act and various cities and banks offer relief. Here̵

7;s what you should know.

USA TODAY

Sustained layoffs are slowing the labor market, which bodes ill for the wider recovery in the United States, as millions of out-of-work Americans are delaying their mortgages and rents.

More than 6 million households failed to pay their rent or mortgage in September, according to the Mortgage Bankers Association’s Research Institute for Housing America, a sign that the economic downturn from the coronavirus pandemic is weighing on unemployed Americans as Congress sticks to relief measures.

In the third quarter, the percentage of homeowners and tenants fell behind on their payments slightly from the previous quarter. Still, the total amount remains high, experts warn.

Housing: Housing prices are kept down by COVID-19 in large cities, while they climb sharply in less crowded areas

Rent: Where do rents rise and fall most in large cities after COVID-19?

During the summer, the collection of rent and mortgage payments improved as states resumed reopening and more Americans returned to work. However, high unemployment continues to plague millions of American households.

Unemployment fell to 7.9% from 8.4% in August, the Labor Department said earlier this month. Overall, the economy is still recovering excessively after throwing a record 22.1 million in early spring, but the recovery is slowing.

In September, 8.5% of tenants or 2.82 million households missed, delayed or made a reduced payment, while 7.1% or 3.37 million homeowners missed out on their mortgage payments.

Tenants receiving unemployment benefits rose from 3% in early April to 7% in late September. Borrowers receiving jobless assistance remained unchanged at 3% during this time period.

Congress stops COVID-19 relief

Economists are concerned that millions of U.S. households are facing the prospect of falling further behind in the coming months without a new round of much-needed federal assistance.

“With the current moratorium on expiration expiring in January, the situation could become even more challenging for tenants,” said Gary V. Engelhardt, professor of economics at the Maxwell School of Citizenship and Public Affairs at Syracuse University, in a note. “Many renting households across the country could find themselves with nowhere to live and no means to repay unpaid payments. ”

In September, the Trump administration implemented a national moratorium on housing evictions by the end of the year. The moratorium, which runs through Dec. 31, applies to people who earn less than $ 99,000 a year and who are unable to pay rent or housing.

Republicans and Democrats have been stuck for months over sending a new coronavirus stimulus package that saves over issues like the amount of money to give in a federal unemployment benefit.

The Republican-controlled Senate is set to act on an approx. 500 billion Dollars emergency aid proposal next week, an amount rejected by Congress Democrats as insufficient to tackle the pandemic. On Wednesday, Finance Minister Steven Mnuchin said it would be “difficult” to adopt another aid package for COVID-19 before the election.

26 mio. Student borrowers missed out on September payments

Millions of student borrowers have meanwhile fallen behind on their payments, which could have consequences for their credit, experts warn.

In September, approx. 26 million people their student loans. The proportion of student borrowers who missed out on a monthly payment has been constant at 40% since May.

Student debt borrowers receiving unemployment rose from 3% in early April to 8% in late September. In August, the Trump administration extended the March exemption and suspended payments on student loans, stopped levies and waived interest on federal student loans until Dec. 31.

But it does not cover private student loans. Most student loans, or about 92%, are owned by the U.S. Department of Education, according to MeasureOne, an academic data firm. Private student loans make up 7.87% of the total outstanding U.S. student loans.

“Borrowers who end up in default will see a negative impact on their credit, which in turn makes it potentially more challenging for them to rent or qualify for a mortgage,” Engelhardt added.

Under the CARES law passed in March, homeowners with loans struggling financially due to the pandemic can request an indulgence of up to 180 days, which can be extended for a further period of up to a further six months, if borrowers are still under financial coercion.

Forbearance allows borrowers to pause or reduce their mortgage payments, but they will still have to repay the missed payments in the future. However, the exemption from the CARES Act only applies to mortgages with federal support. For those who have non-state-subsidized or private loans, the options for compliance or deferral are left to the discretion of a lender.

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