by: Shriom Arza
Covid-19 has changed the world as we know it. The world will never be the same and the uncertainty has made countless individuals very worried. Coronavirus is not only taking lives and keeping individuals away from friends, family, and their routine way of life; it will also take away many people’s homes. Many experts predict that the country will soon see a tidal wave of tenant evictions and real estate foreclosures. With a flood of constantly new information being presented to us on a daily basis, many wonder what kind of protection is available to them. Fortunately, there are ways at the national, state, and local levels for tenants and property owners to keep their homes. A number of acts were recently passed to assist people struggling financially due to the pandemic. Now, government officials are deciding whether they are going to be extended or be allowed to expire.
At the national level, the Federal Housing Finance Agency (FHFA) announced that Fannie Mae and Freddie Mac (the Enterprises) will extend their single-family moratorium on foreclosures and evictions until at least August 31, 2020. A moratorium simply means a temporary prohibition on an activity, so a moratorium on evictions, means that individuals cannot be evicted or their homes cannot be foreclosed on while the moratorium is still active. Unfortunately, this foreclosure moratorium only applies to Enterprise-backed, single-family mortgages. The previous moratorium expired on June 30th. The director of the FHFA Mark Calabria said, “[t[o protect borrowers and renters during the pandemic we are extending the Enterprises’ foreclosure and eviction moratorium. During this national health emergency no one should worry about losing their home.”
A federal law passed on March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act, put in place protections for homeowners with mortgages that are federally or Government Sponsored Enterprise (GSE) backed or funded (FHA, VA, USDA, Fannie Mae, Freddie Mac). Homeowners are entitled to mortgage forbearance if they have a federally or GSE-backed mortgage and are experiencing financial hardship due, directly or indirectly, to the Coronavirus National Emergency. Forbearance is when a mortgage servicer (the company that sends your mortgage statement and manages your loan), or lender allows a borrower to pause or reduce their payments for a limited period of time. Forbearance does not erase what one owes. Borrowers will have to repay any missed or reduced payments in the future. If you’re able to keep up with your payments, keep making them. The types of forbearance available vary by loan type. Some lenders allow borrowers to simply add those missed/reduced payments to the end of the loan, effectively extending the length of the loan. Other lenders are not so forgiving, and will expect borrowers to make all of the missed payments at once when forbearance ends. When requesting mortgage relief one should be very prepared with relevant information about their loan and their finances, and make sure to ask many questions so that they know exactly what their lender will do and expects from them. It is important to contact your mortgage provider about your options as soon as possible if you are struggling paying your mortgage at all.
Florida residents, unfortunately, do not have the same protection they did concerning foreclosures and evictions before August 1st, 2020. Before August 1st, evictions and foreclosures were completely prohibited. However, tenants have lost this protection subsequent to August 1. The law now states “For purposes of this section, adversely affected by the COVID-19 emergency means loss of employment, diminished wages or business income, or other monetary loss realized during the Florida State of Emergency directly impacting the ability of a residential tenant to make rent payments.’ This can sometimes be tough for many individuals to show in the limited amount of time they have to respond to an eviction suit. People fear that COVID-related eviction filings could create a wave of homelessness in Florida. Many may ignore court summons, not realizing that a summons starts a fast-paced legal process in which the tenant has just five days to respond or automatically lose their case and be evicted. If you were officially served with an eviction notice and can prove you were negatively impacted by COVID-19, you will have to do so by responding to the official notice within five business days. You may have all the evidence to prove your condition, but if you do not “appear” in court by responding with a pleading within that time, then you may most likely be evicted. If you are behind on your rent payments or think you may in the near future then you should start collecting any documents that will help prove you were adversely affected by the pandemic, such as bank statements or proof that you were fired or furloughed by your employer, that way you will already be prepared.
In the Tampa Bay area there are a number of resources available for individuals in need of help. Hillsborough County is offering financial assistance services and free tax services if needed. The following link will take you to a hub full of services the county is providing:https://www.hillsboroughcounty.org/residents/public-safety/emergency-management/stay-safe/getting-help.
In Pinellas County, for help in applying for federal funding to help pay rent or mortgages, you can visit the following website: www.jwbpinellas.org/neighborhood-family-centers.
If you need additional information or are facing eviction or foreclosure then contact the Law Office of Gian-Franco Melendez, LLC to speak with an experienced attorney about your options.