Resource: Eviction, Mortgage and Foreclosure Relief During COVID-19
Industry Update
February 19, 2021
Source: Justia
The coronavirus pandemic has led to widespread public health and economic impacts. As a result of shelter in place orders, quarantines, illness, school closures, and other factors related to COVID-19, many people throughout the US have lost work. This has resulted not only in record numbers of unemployment claims, but also in possible housing insecurity for millions due to loss of income.
Federal Housing Protections
The federal government initially responded to this potential housing crisis by implementing protections for tenants and mortgage loan borrowers under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Specifically, tenants renting units in properties with federally backed mortgages could not be evicted or charged penalties for nonpayment of rent for a period of 120 days between March 27 and July 24, 2020.
President Donald Trump then issued an executive order on August 8, 2020 stating an intention to address pandemic-related evictions, but the order did not contain any concrete policies or aid that would prevent them. On September 1, the Trump administration announced a Centers for Disease Control (CDC) order creating a nationwide eviction moratorium for eligible renters, which will be carried out pursuant to the CDC’s authority to combat the spread of disease. Qualifications for the moratorium’s protections include having an expected 2020 income of $99,000 or less for individuals or $198,000 for couples, or having received a stimulus check earlier in the year. This order most recently has been extended through March 31, 2021.
Homeowners are also protected to a certain extent if they have a federally guaranteed mortgage. These mortgages account for over two-thirds of residential mortgage loans across the US. While initial protections under the CARES Act have expired, the administration of President Joseph Biden has extended a foreclosure moratorium for federally guaranteed mortgages through June 30, 2021. Moreover, the Biden administration has extended the mortgage payment forbearance enrollment window to the same date. Borrowers who entered forbearance on or before June 30, 2020 will receive up to six months of additional mortgage payment forbearance in three-month increments.
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