Survey: Homeownership had its advantages in 2020, but stress remains for many

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Owning a home can be a double-edged sword.

Folks who have built up some equity might be able to tap into their homes for cash to help them out during a rough spot. At the same time, the burden of mortgage payments — along with uncertainty about the future — can become overwhelming during a financial downturn.

In a joint survey by Credit Karma and Qualtrics, 20% of respondents who are homeowners said they tapped into equity in the last 12 months — in many cases to pay for necessities and emergency expenses. And 24% of homeowners in our survey went into forbearance in the last 12 months. (In this survey, we used the CFPB’s definition of forbearance, which is “when your mortgage servicer or lender allows you to temporarily pay your mortgage at a lower payment or pause paying your mortgage. You will have to pay the payment reduction or the paused payments back later.”)

But we also found that a good share of people aren’t giving up on the idea of homeownership — 30% of respondents in our survey are considering buying a home in the next 12 months. And of the 70% who aren’t in the market for a home in the next year, only 2% overall said they’ll never want to buy a home.

Read on for more, including info on forbearance for those struggling with mortgage payments.

Key survey findings

Over half (57%) of respondents were homeowners, while 32% rent and 9% live with parents. For those not currently looking for a home, only 2% say they’ll never buy a home.
Among homeowners who had tapped into their home equity in the last 12 months, the most popular uses for the money included home renovations (41%), covering an emergency expense (31%), paying down debt (30%) or paying for necessities (27%).
Among respondents who currently own their own home, 24% went into forbearance in the last 12 months. Of those in forbearance, 59% felt that their financial stability depended on being able to delay their mortgage payments, and 62% agreed that they felt stressed about the payments they would eventually need to make towards their mortgage in the future.
In a series of questions aimed at gauging respondents’ financial literacy, only 54% of people correctly identified the definition of home equity, while 62% selected the correct definition for home value. Interestingly, 84% of people knew that it’s possible to leverage home equity to access cash.

Homeownership is unevenly distributed in the U.S.

More than half (57%) of survey takers live in a home that they own, which lines up with the U.S. Census Bureau’s estimate that 58.6% of housing units in the country are owner-occupied. Renters made up 32% of the respondents — 26% renting their own place and 6% renting with roommates. Finally, 9% live in their parents’ home.

In our survey, we found the homeownership rate to be highest among white respondents (62%), followed by African American (38%) and Hispanic/Latino (37%) individuals. Hispanic/Latino respondents (23%) were also more likely to live in their parents’ home than white (6%) or African American respondents (14%).

Looking at homeownership rates by age groups, Generation Z (people age 18 to 24) had the lowest rate of homeownership at only 22%, according to our survey. This makes sense given that homeownership rates tend to go up with age — and considering that 40% of Gen Z respondents in our survey were still living with their parents. That’s compared to 10% of millennials (ages 25 to 40) living with their parents and just 3% of Gen X (ages 41 to 55).

Many Americans want to own their homes, especially after the pandemic.

Overall, 30% of respondents are considering a home purchase in the next 12 months, which breaks down to 28% of homeowners thinking about a move and 35% of renters.

And among all renters in our survey, 42% agreed that the pandemic made them want to purchase their own home, either now or in the future.

The top motivations for purchasing a home among respondents who are renting include the following:

  • The need for more outdoor space (31%)
  • The need for more indoor space (30%)
  • Desire to build equity and/or feeling that renting is not a good investment (24%)

Also of note: Among people who are not considering a home purchase in the next 12 months and who are renters, not one has ruled out buying a home some day — making it clear that homeownership is still part of the American dream.

To assess Americans’ understanding of two basic terms related to home ownership, Credit Karma asked survey takers to select the correct definition for the terms out of four possible options. (See methodology for full questions.)

Home equity is defined as the market value of the home minus what’s owed on it. Only 54% of respondents selected the correct option. Homeowners were more likely to pick the right option at 59%, compared to 45% of renters.

Respondents did slightly better identifying the meaning of home value, which is the current market value of a home. A whole 62% were able to pick out the correct definition. Homeowners had the right choice 65% of the time, compared to 58% of renters.

Interestingly, people who had tapped into their home equity in the last 12 months did worse than the overall group in selecting the correct definitions. Only 45% of this group correctly identified the definitions of home equity and home value — an indication that people may be getting financial products they don’t fully understand.

One area of particularly strong understanding: 84% of survey respondents overall knew that it’s possible to leverage home equity to access cash. And among those who had tapped into their home equity in the last 12 months, the rate rose to 92%.

Homeownership was a lifeline for some.

Of the 57% in our survey who are homeowners, 20% accessed their home equity in the last 12 months. Their reasons varied — with some folks having multiple motivations.

Here are the most common reasons homeowners gave us for tapping into their equity.

  • 41% to pay for home renovations
  • 31% to pay for an emergency expense
  • 30% to pay down debts
  • 27% to pay for necessities like groceries, utilities and other bills
  • 24% to pay for nonessentials like travel and entertainment

There are a few different ways to access home equity, including home equity loans, home equity lines of credit and a cash-out refinance. While these options can come with other fees and costs, the APR could be less than what you’d pay on a payday loan. Depending on home value and how much you’ve paid down, home equity could also potentially be a much larger amount of cash than you’d be able to access from other sources.

Forbearance has been a saving grace for some.

While home equity has helped some survey takers out of a tough spot, 24% of homeowners in our survey went into forbearance in the last 12 months.

While in forbearance, 31% used the cash that would have gone towards their mortgage for essentials like groceries, medical attention and utilities. Others were able to save or pay down other debts — but 13% said they didn’t have any extra money even while in forbearance.

Among homeowners in forbearance, a full 59% said that their financial stability depends on being able to delay their mortgage payments — and 62% agreed that they’re stressed about the mortgage payments they’ll eventually need to make once they’re out of forbearance.

Forbearance and tapping into home equity probably helped save some people from losing their homes. But in both scenarios, homeowners have to eventually deal with catching up on payments or paying for additional debt. This is the double-edged sword of homeownership.

Tips for dealing with forbearance

Talk to your servicer

The first step to getting forbearance is talking to your mortgage servicer. You’ll need to ask about its forbearance or hardship options.

Note: Sometimes your mortgage servicer is not the same as the financial institution that you originally got your mortgage from. When asking for forbearance, you need to make sure you’re talking to the correct entity.

You should also check to see who your mortgage is backed by. If your mortgage is backed by Fannie Mae, Freddie Mac or the federal government, you may have additional help available to you.

If you’re asking for forbearance because of a disaster, you’ll want to contact your lender ASAP. Some servicers will only accept disaster-related forbearance requests within a certain amount of time from the disaster.

Understand your options

Forbearance can look different depending on the type of loan you have, what the requirements are for your mortgage and who your servicer is. Forbearance may mean that your payments are paused entirely or that your payment amount is temporarily reduced.

Make sure you understand what you’ll owe and when forbearance ends. With certain types of forbearance, you may end up owing all your paused payments in a lump sum as soon as the forbearance period is over.

One thing to keep in mind: Interest continues to accrue even on the paused or reduced amounts.

Phone a friend

This whole process can be incredibly overwhelming. If you need some help, the CFPB has created a tool to help you find housing counselors that are approved by the Department of Housing and Urban Development, or HUD.

You can also call the HUD’s HOPE™ Hotline at 888-995-4673 any time of the day, any day of the week.

Additionally, the federal government maintains a Hardest Hit Fund with special help for homeowners in states where a disaster has hit particularly hard. Use the link above to see if your state is on the list.

If you’ve been financially affected by COVID-19, the CFPB has put together a list of resources for homeowners and renters. The bureau has done the same for coronavirus forbearance advice.


On behalf of Credit Karma, Qualtrics conducted a nationally representative online survey in April 2021 among 1,033 American adults to understand homeownership and homebuying trends.

The questions for assessing respondents’ understanding of home equity and home value appeared as follows:

Select the best definition for [term] from the options below:

  • The market value of your home, minus what you owe
  • The total market value of your home
  • When the value of your home equals what your paid for it
  • The mortgage amount you’re approved for

The answer choices appeared in a random order for all survey takers. The home equity question appeared before the home value question.

About the author: Gaby Lapera is a researcher and writer at Credit Karma and a personal finance expert. She also spends time working on investing and science communication. Gaby graduated with a master's degree in biological anthropolo… Read more.