If you’re hoping for a quick recovery from the Covid-19-driven economic collapse, we’ve got good news and bad news. The good news is that we’ve studied the Great Recession and singled out a crucial factor in how fast the economy can recover: debt relief. The bad news is that, right now, Washington isn’t taking serious action to give people a break on their mortgage and rent payments, student debt, and auto loans.

This crisis did not start in the household sector, but the problems faced by households are similar to 2008. The record 16.8 million new jobless claims already filed have mortgage lenders preparing for the biggest wave of delinquencies in history. By our estimates, more than 30% of all borrowers could default on their mortgage, about 1.5 times the level of defaults during the 2008 crisis. As we learned in that recession, the pain of defaults does not stop with the borrower: The damage creates ripple effects that slow down the economy. Ruined credit scores make it harder for borrowers to get future loans, foreclosed homes fall in value and bring down neighborhood property values, and cities suffer when borrowers have less to spend at local restaurants and businesses.

Washington has to move quickly—right now—because we know from the Great Recession that how we handle debt relief today will critically determine the speed of the recovery. Swift action can prevent the imminent surge of mortgage defaults from spiraling into a prolonged recession.

We analyzed a decade of data and millions of U.S. households following the Great Recession, finding that regions that did not receive household debt relief took about four more years to recover in terms of consumer spending, house prices, and employment than the ones that did. In general, both household debt overhang and the foreclosures that follow mortgage defaults significantly hamper economic activity and slow down economic recovery.

Washington has at least acknowledgedthis need: A major piece of the $2 trillion Cares Act is a mandate that all borrowers with government-backed mortgages—about two-thirds of all mortgages—be allowed to delay at least 90 days of monthly payments and possibly up to a year’s worth. This is an important first step that buys us some time. But it will not be enough and should not be considered a long-term remedy. These deferred payments will need to be made at a later time. Households already distressed, because they lost jobs or income, will have a hard time coming up with the money, when the time comes.

An even more important lesson from the Great Recession is that the method for distributing debt relief is critical. The Cares Act calls for relying on private sector loan servicers—like Wells Fargo and Bank of America—for debt relief. But we cannot and should not rely solely on the private sector, because we have some evidence of how they respond. After the Great Recession, the Obama administration created programs in 2009 designed to encourage banks and lenders to refinance and work out mortgages. But many decided against it anyway because it didn’t align with their incentives: Some mortgage servicrs felt they did not have enough incentives to restructure loans, many banks and lenders felt borrowers didn’t have enough equity, they didn’t see a competitive need to offer refinancing, or they didn’t want to encourage moral hazard. Several simply didn’t have the organizational ability to conduct restructuring on a large scale. The results were discouraging: even though these programs were designed to help 12 million borrowers, barely 5 million were actually able to use them. In fact, loan servicers’ refusal to renegotiate with many borrowers, particularly in the first year of the Great Recession, by itself accounted for upward of two million foreclosures.

At a fundamental level, a bank or investor’s balance sheet doesn’t reflect the positive impact of an unemployed airline or hotel worker keeping their home and being able to spend more freely. Nor will it reflect the adverse effects to the local economy of foreclosing a home. Banks and lenders have a fiduciary duty to focus on returns for their investors. Left to implement programs on their own, they’re not likely to achieve the level of debt relief that the U.S. needs right now. And under the Cares Act, banks and loan servicers are now required to make up any shortfall in payments in the interim. Just like in the aftermath of the Great Recession, banks and lenders will have the wrong incentives if we want them to help borrowers with their mortgage payment.

Vulnerable households need permanent and quick debt relief. Washington can help directly. The easiest and cheapest approach would be to leave debt balances intact and instead forgive or take over the interest payments on debt, including mortgages, credit cards, and student loan debt. Since federal and state governments mandated the stay-at-home orders creating this downturn, it is only reasonable that taxpayers should pick up the tab. A good policy would start by forgiving six months of interest—and working directly with borrowers rather than relying on lenders for implementation. A reevaluation of the length can be done later when we have a clearer picture of the severity of the crisis.

Renters, by definition, do not make interest payments and unfortunately wouldn’t benefit. Washington should consider a special housing voucher program that offers relief to renters and avoids evictions.

To make sure taxpayers don’t overcommit, the federal government could impose eligibility requirements, targeting relief to those households that have suffered a documented loss of income or financial hardship. By our estimates, a targeted policy could cost up to $100 billion.

Congress should start taking these measures into account when it returns to Washington to start work on the next phase of the economic rescue.If we do not act aggressively and immediately, we risk making the same mistakes that resulted in a prolonged and slow recovery during the last crisis.

Tomasz Piskorski is the Edward S. Gordon professor of real estate at Columbia Business School and a research associate at the National Bureau of Economic Research. Amit Seru is the Steven and Roberta Denning professor of finance at the Stanford Graduate School of Business, a senior fellow at the Hoover Institution, and a research associate at the National Bureau of Economic Research.