With the arrival of the COVID-19 pandemic and subsequent economic instability, the U.S. government has provided certain relief efforts to ease the burden homeowners and renters are facing.
There have also been other efforts (specifically the historically low mortgage rates we’ve been able to take advantage of, which we discussed last week) to stimulate the real estate market across the country. However, the months have sailed by and we are all still facing uncertainty. Some states are back in quarantine and jobs everywhere remain furloughed or at risk. We may have barely been noticing time fly by as we binge-watch everything on Netflix and HBO, but the dates that these efforts were set to end are nearly here, and others have already passed. So, exactly what efforts are in place, have any programs been extended, and are there any other options available?
On March 27, 2020, the federal government passed the CARES (Coronavirus Aid, Relief, and Economic Security) Act. This act provides two protections for homeowners with mortgages that are federally or GSE backed or funded. These protections are as follows:
- Your lender or loan servicers cannot foreclose on a home until August 31, 2020. This means no lender or services may begin any judicial or non-judicial foreclosure, nor can they finalize one.
- If a homeowner has experienced financial hardship due to the pandemic, they have the right to request and obtain a forbearance for up to 180 days.
To read up on further details, and check for updates, this information can be found by clicking here.
Some people may have been, and currently still are, facing hardships that fell outside of what the CARES Act covers. Lenders and loan servicers encourage these homeowners to reach out to discuss their issues and explore potential alternative solutions. Also, each state may have additional COVID-19 related relief orders, and you’re encouraged to read up on them, and their expiry dates.
Unfortunately for renters, the protections provided by the CARES Act expired on July 24 and July 31, 2020. From the period of March 27, until July 31, no landlord or housing authority could:
- File a legal action to evict for non-payment of rent or other fees
- Charge fees or penalties related to non-payment
- Give a renter a 30-day notice to vacate until July 25, 2020
There were certain exceptions, namely if a landlord had already filed for eviction before March 27, or if the renter was being evicted for reasons other than non-payment.
None of this meant that payments or rents were no longer due. For renters, this meant that while they had protection if they could not pay, those rents owed would still be owed after July 24. So, if that renter had not been able to pay for three months, three months’’ rent payments would then be due at once. Those renters would then need to come to a repayment agreement with the homeowner if they were unable to pay those accumulated rents. Although, there may be an exemption or a reduction for those living in federally subsidized housing. All of these details can be found by clicking here:
Where does this leave us now, with protection end dates having passed or quickly arriving?
While recent executive orders have extended COVID-19 relief efforts and discussed extensions for the eviction moratorium (for both homeowners and renters), there doesn’t seem to be any update with exact details. At least not at the current time. To read up on which efforts have been extended or are under discussion, you can read a recent article from Forbes.
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