Americans just weren't ready for a financial crisis themagnitude of the coronavirus pandemic. In fact, according toClever.com,however shaky or sturdy people's financial wellness may have beenbefore Covid-19 hit, a lot of them are a lot worseoff, with 50 percent saying their savings are going to run out bythe end of the month.
|In addition, 25 percent have taken on more debt, 75 percent saythe financial effects of the pandemic will be worse than those ofthe Great Recession (and remember, the recovery was only a recoveryfor part of the economy, with plenty—particularly millennials andwould-be retirees—still struggling), 30 percent of homeowners hadless than $1,000 in emergency funds before the pandemic hit and 22percent don't have enough in savings to make one month's mortgagepayment.
|Home buyers, says the report, are pulling out of the market,with 48 percent deciding to postpone looking for a residence. Homeowners, on the other hand, are putting off mortgage payments, withalmost 16 percent of those with a mortgage saying they've madeagreements with their loan servicing companies to suspend or reducetheir monthly payments for now.
|And sellers are pulling their homes off the market, with 85percent of those who had intended to sell within the next 12 monthschanging their minds because of the pandemic. Twenty-three percenthave pulled the listing, 27 percent had to drop the listing priceand 31 percent are postponing listing their homes.
|When it comes to renters, 45 percent don't have enough savingsto cover a month's rent, and almost 40 percent are worried aboutevictions—but just 11 percent have managed to work something outwith their landlords for either rent forgiveness or a reduction inrent.
|And about those renters: according to the report, when comparedwith homeowner respondents to the survey, 46 percent said they hadless than $500 in emergency savings—and renters were twice aslikely to say that they'd never had emergency savings. A quarter ofrenters are having a tough time paying their rent.
|Emergency funds just aren't going far enough for renterrespondents, with 13 percent saying they'd already spent what theyhad and 11 percent saying that what they'd managed to stashwouldn't even last a month. Only 6 percent said they had enough putby to last them six months to a year.
|And people without cash are taking on debt, with 58 percentsaying it's on credit cards, 21 percent cash-out refinancing, 27percent getting personal loans and 29 percent borrowing from afriend or a family member. And among those who have taken on debtas a result of Covid-19, 72 percent have borrowed less than$2,000—but an unfortunate 5 percent say they're already $10,000behind.
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