The Consumer Financial Protection Bureau (CFPB) says the overall mortgage related complaints it has received recently are at their highest level in three years. The report was one of two that the agency says show that more work needs to be done to help mortgage borrowers during the COVID-19 pandemic and its economic fallout. A second report documents that Black and Hispanic mortgage borrowers are much more likely to be delinquent or in a forbearance program than white borrowers.

CFPB said consumers submitted more mortgage complaints in March than in any month since April 2018. Those concerning forbearance or related issues also reached their highest monthly average since March and April of 2020. The number of borrowers who report they are struggling to make their payments is also trending upward.

Many consumers complained that servicers did not provide clear and accurate information about their options, especially regarding loss mitigation after forbearance ends. Consumers also said the information they did receive was confusing and incomplete.  The Bureau said servicers should use all available tools to reach struggling homeowners and to do so in advance of the end of the forbearance period.

Consumers reported long delays in having their loan modified so that they could resume payments on the mortgage. Some delays were due to demands for additional documents, others because of the aforementioned lack of information about available options and the consumer's eligibility.

CFPB Acting Director Dave Uejio said, "More borrowers are behind on their mortgage than at any time since the height of the Great Recession." He reiterated the Bureau's warning to servicers last month that being unprepared to deal with these problems will not be acceptable.

"Communities of color have been hit hard by the pandemic, and the latest data show that many borrowers are still hurting. The CFPB will continue to seek and actively respond to developments in the market, doing everything in our power to help families stay in their homes," Uejio said.

The second report, a research brief titled "Characteristics of Mortgage Borrowers During the COVID-19 Pandemic," shows that some homeowners and communities are more at risk than others. One third of borrowers in forbearance and 27 percent of delinquent borrowers are Black or Hispanic, while those groups account for only 18 percent of all mortgage borrowers.

The research also shows that loans that are delinquent or in forbearance are disproportionately likely to have high loan-to-value (LTV) and limited equity, leaving them vulnerable to being underwater. Half of forborne loans have an LTV greater than 60 percent, compared to only 34 percent of current loans.  Borrowers who are behind on their payments but not in forbearance are more than five times as likely to have an LTV greater than 95 percent than borrowers who are current.

CFPB also said it is seeking comments on a proposal to help prevent avoidable foreclosures for borrowers affected by the COVID-19 emergency.  That proposal, if finalized, would temporarily require servicers to enhance communications with borrowers who are delinquent or in forbearance, allow servicers to offer certain streamlined loan modification options to borrowers with COVID-19-related hardships, and require servicers to afford all borrowers a special pre-foreclosure review period.  The comment period closes May 10th.