September 28, 2021

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Mortgage News

FHA, FHFA Extend Eviction Moratoria Through September

That Federal Housing Finance Agency (FHFA) announced that Fannie Mae and Freddie Mac (the GSEs) are extending the Moratorium on Single Family Evictions (REO) through Thursday, September 30th, 2021. The REO eviction moratorium applies to real estate acquired by a GSE through foreclosure or deed-to-replacement from foreclosure transactions.

On June 24th, both the FHFA and the Center for Disease Control (CDC) extended COVID-related moratoria on foreclosures and evictions originally expiring on June 30th, with a further extension until Saturday, July 31st, 2021.

“The pandemic continues to have an outsize impact on the ability of Americans to make their monthly rent or mortgage payments,” said FHFA Managing Director Sandra L. Thompson. “Today’s extension of the eviction moratorium protects particularly vulnerable Americans who otherwise run the risk of losing a place to stay.”

REO’s eviction moratorium is just the latest step FHFA has taken to help homeowners, tenants and the mortgage market during the pandemic. The FHFA continues to monitor the impact of COVID-19 on borrowers, the GSEs and their counterparties, and the mortgage market. The FHFA can revise its guidelines based on updated data and health risks.

The Federal Housing Administration (FHA) has also announced an extension of its moratorium on evictions for forced borrowers and their residents through September 30, 2021, and has noted the expiration of the foreclosure moratorium on July 31, 2021. This extension is part of Announcement from President Joe Biden on July 29 that federal agencies will use their powers to extend their respective eviction moratoriums through September.

“We must continue to do everything in our power to ensure that foreclosed borrowers affected by the pandemic have the time and resources to secure safe and stable housing, whether in their current homes or through obtaining alternative housing, ”said Deputy Assistant Secretary for Housing Lopa P. Kolluri. “We don’t want individuals or families to be unnecessarily displaced while trying to recover from the pandemic.”

Mortgage service providers must continue to stop evictions for FHA Single Family Title II Forward and Home Equity Conversion Mortgage (HECM) properties, with the exception of properties that are legally vacant or abandoned. Servicers may initiate or resume foreclosures in accordance with FHA requirements once the moratorium on single family foreclosure expires as planned on July 31, 2021, but they are not allowed to evict a foreclosed borrower or other resident.

Yesterday, US President Joe Biden called on Congress to extend the July 31 eviction moratorium, urged the US departments of housing and urban development, agriculture, veterans affairs, local communities and other agencies to do the same. The Biden administration is cannot perform an expansion alone based on a recent Supreme Court ruling that new legislation is needed for the CDC to extend its federal moratorium beyond the July 31st deadline.

“The President urges states and communities that long ago received emergency aid for rent – including through the American rescue plan – to urgently accelerate their efforts to disburse these funds in view of the imminent end of the CDC eviction moratorium.” Read a White House press release. “With some cities and states demonstrating their ability to efficiently distribute these funds to tenants and landlords in need, there can be no excuse for any state or municipality to use the resources Congress has allocated to address these critical needs of so many Americans not to be used immediately. The government remains determined to do everything in its power to keep people safe and secure, which is essential to the health, well-being and dignity of all of us. “

MP Maxine Waters, Chair of the House Financial Services Committee, also took steps to expand protection for homeowners and tenants HR 4791 – Law to protect tenants from evictions from 2021, a measure that would extend the eviction moratorium until December 31, 2021.

According to a ruling by the Supreme Court written by Judge Brett Kavanaugh, the eviction moratorium can only be extended by Congress, and this law will do just that, ”said Rep. Waters. “Extending the moratorium through the end of the year is the right way to prevent the rise in homelessness and the spread of the coronavirus as states and communities work to raise the $ 46.6 billion Congressional emergency aid for rentals to distribute.”

Beginning of the week that Appreciated by Mortgage Bankers Association (MBA) that approximately 1.74 million US homeowners continue to seek homeowner protection through deferral plans.

“The current eviction moratorium expires on July 31st, putting millions of people at great risk of eviction and homelessness,” said Rep. Waters. “That is unacceptable in one of the richest countries in the world. Even before the pandemic, more than 580,000 people are homeless each night and 10.5 million households paid more than 50% of their income for rent.

“While Congress approved funds for emergency rental aid, it is now up to state and local governments to expedite the distribution of that aid,” Rep. Waters continued. “However, these funds have only come out slowly. According to the US Treasury Department, households had only reached $ 3 billion in emergency aid for rents by the end of June. Our efforts to provide emergency rental assistance will prove futile if families are evicted before they can get help. We also need to acknowledge the reality that, unlike large landlords who often have reserves, small landlords rely on rent to cover their monthly mortgage payments and other expenses. “

The House Rules Committee has convened an emergency meeting for Friday morning to press HR 4791 before tomorrow’s deadline.