Half of Americans Worry About Making Mortgage Payments

A recent Washington Post poll found that 53 percent of all Americans are concerned that they will not be able to pay their mortgage or rent, despite the fact that they believe the economy has shown some improvement since the dark days of 2008.  The worry is driven by slow job creation, said Karen Dynan, who served as a Federal Reserve economist and on George W. Bush’s Council of Economic Advisors.  According to Dynan, “The unemployment rate is still very high, so if you think of it as being about the odds of someone losing their job and not being able to find another there’s good reason to be concerned about being able to make mortgage payments,” according to Dynan, who is now co-director of economic studies at the Brookings Institution.

More than half of Americans want the Obama administration to impose a moratorium on foreclosures on homeowners who are unable to make payments.  The president and his economic advisors oppose the idea, saying it is dangerous to a housing market that is still on shaky ground.  The push for a moratorium is driven primarily by people’s worries about personal finances and the economy as a whole.  Not surprisingly, the people most worried about making their payments are strong supporters of the moratorium.  Compounding the situation is the fact that several lenders – notably Bank of America, JPMorgan Chase and Ally Financial – were found to have significant errors in some of their foreclosure documents.  Of those polled, 52 percent support the moratorium, while 34 percent oppose it.

So who do Americans think is responsible for the foreclosure mess?  The mortgage lenders are to blame, according to 45 percent of poll respondents; 26 percent thought that homebuyers who purchased beyond their means are the guilty party; another 20 percent blames both sides.  Cara Habegger of Akron, OH, summed up the last point of view.  “Certainly they are both at fault.  Most people tend to blame the big institutions and that’s valid but if you’re making poor financial decisions and buying houses you can’t afford, that’s also not excusable,” she said.