Am I Safe From Eviction or Foreclosure During the Coronavirus Outbreak?

As the number of individuals testing positive for the Novel Coronavirus increases in the United States, and with it the public’s uncertainty of what will happen next, the economic fallout has led many to wonder how they will pay their bills or if they’ll have a roof over their heads in the coming months. 

In response to these concerns and the growing number of people filing for unemployment, the administration announced steps to stabilize the housing market, protect homeowners, and keep those facing eviction in their current dwellings until the outbreak is under control. 

Mortgage Freeze

The Department of Housing and Urban Development and Federal Housing Finance Agency’s freeze on mortgages applies to those insured by the Federal Housing Administration as well as mortgages serviced by Freddie Mac and Fannie Mae, the Department of Veteran’s Affairs, and the Department of Agriculture and Rural Housing Service. Along with the freeze on mortgages, a temporary halting of evictions was also ordered for properties under the same categories. The proposed plan suggests 60 days for mortgages controlled by the Federal Housing Administration. There is no specific timeframe for how long evictions will be frozen. Most states are halting evictions until courts in those areas reopen. If an eviction notice was already served and the process was underway before the coronavirus’s impact on the economy the affected party may still have their case processed or will likely be one of the first to be processed once the courts open. 

What About Landlords and Other Mortgage Companies?

Landlords who still hold a mortgage under the loan servicers listed above should be included in those who can postpone their payments. However, whether it be a landlord, single-family home mortgage, etc, it is important that the mortgage holder contact their loan servicer, the company they send their monthly payment to, so they determine their eligibility and learn what options are available to them. 

If the loan is not under one of the entities listed above, and mortgage assistance is needed during these difficult economic times, it is highly advisable to reach out to your loan servicer and ask what programs they have available for mortgage relief.

Renters and Eviction Cases

Unfortunately, renters appear to be getting the short end of the stick in this deal, for the time being at least. The hope might be that by freezing mortgages and evictions that a trickle-down effect will allow some percentage of renters to remain in their dwellings, but it does little to help protect them once the economy stabilizes, allowing courts to open up and the eviction freeze to end. One could argue that the landlord of a building of renters not paying rent would be in a tough situation if the renters were suddenly unable not to pay rent for 3 months to a year, and that would be a valid argument. But from a legal and business standpoint the landlord has more options or avenues to shoulder the burden of these tough times then the individual. Either way, the unfolding situation is a bleak one. As the 2-trillion dollar stimulus package looms, maybe we’ll see some provisions that will help renters, beyond straight cash in hand. 

Illinois And Iowa

Both Illinois and Iowa have implemented short-term emergency plans in order to provide some degree protection for renters and homeowners alive. In Illinois Governor Pritzker issues and executive order freezing residential evictions until April 8th. The 10th Judicial Court is halting eviction cases until April 17th in a handful of counties. Illinois has also been approved for disaster assistance loans for small businesses. Chicago also halted evictions cases handled in the Circuit Court of Cook counter until April 15th.

Iowa Governor Kim Reynolds initiated a short-term suspension of certain evictions and froze all foreclosure proceedings and the prosecution of foreclosure proceedings that have already begun on residential, commercial and agricultural real property throughout the state of Iowa. This emergency plan is currently set to expire on April 16th, 2020.

If you are a homeowner, renter, or property owner and want to learn more about your options, don’t hesitate to call our office at 630-324-6666.