Protecting Homeownership From the Impact of COVID-19

By: Julia Gordon and David Sanchez, National Community Stabilization Trust (NCST); Lindsay Augustine, Diane Cipollone, Debby Goldberg, and Lisa Rice, National Fair Housing Alliance (NFHA).

Download the full paper (PDF: 1.2 MB)


During and after the Great Recession, almost eight million homeowners nationwide lost their homes to foreclosure. While vacant and abandoned homes blighted many neighborhoods throughout the country, tight access to credit locked many prospective owner-occupants out of the market. As a result, foreclosed properties were overwhelmingly sold to investors, and ultimately more than five million homes transitioned from owner-occupied to investor-owned rental homes. These trends were even more concentrated in communities of color, sending the homeownership rates for both African Americans and Latino Americans tumbling.

Today, we face a different housing crisis. The COVID-19 pandemic is wreaking havoc on Americans’ health, well-being, and employment. In this new research, the authors identify best practices learned from the Great Recession to blunt the pandemic’s impact on homeownership.


The authors’ recommendations fall broadly into two buckets: policies related to people and properties.

Policies that improve people’s outcomes:

  • Increase access to COVID mortgage forbearances
  • Give borrowers the post-forbearance options best suited for their circumstances
  • Encourage communication between borrowers and mortgage servicers
  • Ensure the Homeowner Assistance Fund meets its goals
  • Support alternatives to foreclosure, such as short sales, for those who need them
  • Prevent the pandemic from negatively affecting consumer credit scores
  • Allow borrowers to access new mortgages after forbearance and foreclosure
  • Eliminate forbearance penalties that decrease access to credit

Policies that improve property outcomes:

  • Prioritize homeownership and neighborhood stabilization in distressed and REO sales
  • Properly maintain REO properties in all neighborhoods
  • Prevent zombie foreclosures and aggressively address vacancy problems

By preventing unnecessary foreclosures and home loss, maintaining access to credit, ensuring vacant properties do not blight communities, and leveling the playing field for owner-occupants to purchase homes, the housing community can prevent the COVID-19 crisis from devastating homeownership and undermining racial equity in housing markets.

The National Association of REALTORS® (NAR) provided financial support to the National Community Stabilization Trust and to the National Fair Housing Alliance for their research on this paper. The opinions expressed are those of the authors, and do not necessarily reflect the positions of NAR.


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