Nearly one in three mortgage borrowers fears foreclosure, JD Power survey warns
Bruce Gehrke (pictured top), senior director of wealth and lending intelligence at JD Power, said while he doesn’t see the 30% number as a crisis yet, it is worth keeping an eye on.
“When you ask that question in the realm of consumer research, you’re getting an emotional response,” Gehrke told Mortgage Professional America. “Is it actually 30% that are really at risk? I don’t think so. I think we would see higher numbers in foreclosures and delinquencies now if it really was.”
‘Harbinger for the future’
The distinction Gehrke draws is between sentiment and outcome, and he said that servicers and brokers should pay attention to both.
“I think this is more of a harbinger for the future, not so much as a current risk,” he said. “But what I think it highlights for servicers from a risk management standpoint is to watch behavior, to try to open up — and it’s a difficult thing in a low-touch environment like this — conversations around this.”
The survey also found that 16% of borrowers incurred a mortgage late fee in the past 12 months, up from 14% four years ago. Also, 15% fell behind at some point, and 58% of borrowers with escrow accounts reported a payment increase in the past year driven primarily by rising homeowners insurance premiums and property taxes.
