GAO Finds Puerto Rico Delinquencies Tripled After Maria but 12-Month Moratorium Blunted Mortgage Losses
Updated
Updated · legis1.com · Aug 25
GAO Finds Puerto Rico Delinquencies Tripled After Maria but 12-Month Moratorium Blunted Mortgage Losses
2 articles · Updated · legis1.com · Aug 25
Summary
Puerto Rico’s mortgage delinquency rate roughly tripled by November 2017 after Hurricane Maria, but foreclosures kept falling during a federal moratorium that ran from late 2017 through the third quarter of 2018, the GAO said.
The report says insured or government-guaranteed loans were more resilient because mortgage insurance and VA backing reduced bank losses, while conventional mortgages without private insurance suffered the heaviest damage.
More than 10% of active mortgages were already delinquent before the storm, and most 2019 foreclosures involved those pre-existing troubled loans, suggesting Maria mostly intensified an already weak market rather than reshaping it.
About 37% of Puerto Rico mortgages had insurance or guarantees in 2017, leaving roughly 63% without that safety net; the GAO said missing data also prevented analysis of housing developers’ returns after the disaster.
The findings, drawn from a New York Fed study and a congressionally mandated GAO review, point to targeted loan protections and temporary foreclosure bans as tools for future hurricane and climate-disaster relief.