Millions of loans payments skipped as coronavirus slows economy: report

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Since the start of the coronavirus pandemic in the U.S., Americans have skipped payments on 100 million student loans, auto loans and other forms of debt, according to The Wall Street Journal.

The number of people who deferred payments or enrolled in forbearance or some other type of relief since March 1 rose to 106 million at the end of May, which is three times higher than it was at the end of April, the Journal reported. 

Within student loans, 79 million accounts are in deferment or other relief status, up from 18 million a month earlier. Auto loans in some type of deferment doubled to 7.3 million accounts, and personal loans in deferment doubled to 1.3 million accounts.

The rise in loan deferments came after the economy plummeted following widespread shutdowns. The federal government has instructed loan providers to allow borrowers to defer to a certain extent. 

The stimulus package passed in March allowed most borrowers to stop making monthly payments through Sept. 30 on federal student loans. The package also allowed homeowners hurt by the coronavirus or its economic fallout to ask their mortgage lenders for permission to pause their payments for up to 12 months.

Several credit card, auto loan and personal loan lenders continue to allow consumers to skip or pause payments while they weather the economic blow of the pandemic. 

Tags Coronavirus economy Forbearance Loans

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