The Eviction Moratorium Has Been Extended, What Does This Mean For Me?

Coronavirus hit the Untied States nearly a year ago, and sent the government into a tailspin to address the economic fallout this pandemic has had on the country, and one of the drastic steps the US government took to protect those affected was establishing moratoriums on evictions and foreclosures. This meant that those who lost their jobs to the pandemic were no longer required to pay their rent or mortgages, but this would have greater implications than many would have thought at the time. In many cases, landlords have active mortgages on their properties, and if their tenant fails to pay during the moratorium, they can’t pay their mortgage. It would seem as if this works out as mortgages are under the moratorium as well, however, there are banks that hold notes for these mortgages. Most of us thought this pandemic would end in a matter of months, and as we enter the second year of this “new normal,” we realize that banks can’t forgive everyone’s loan and at some point the banks will want their money. The moratorium for evictions was set to expire at the end of March, with the moratorium on mortgages to expire in June. Now with just two days left until the evictions moratorium is lifted, the federal government extended it until June. Once these moratoriums are lifted there will be a number of families displaced; it made sense that the expiration dates of these moratoriums were spread out to allow the economy to recover, now those moratoriums are set to expire around the same time. Even as this situation seems grim, there is light at the end of the tunnel. Banks understand the wave of foreclosures are coming due to so many being behind on their payments, so if someone finds themselves facing foreclosure, the bank is more likely to entertain a short sale and allow the owner to avoid a foreclosure. A short sale is when the bank agrees to take less for the property than what is owed. At Helpful Homes, we specialize in helping people who are behind on their mortgages and find themselves in this situation. Banks are not in the business of selling homes, they prefer to hold notes to mortgages, so being responsible for vacant homes is not something they’re looking forward to, which is all the reason they are more likely to entertain a short sale. Coronavirus has had some positive affects on the real estate market such as low inventory and interest rates, but the market has not seen the negative affects of this pandemic and likely won’t until June. In the meantime if you or someone you know finds yourself in a situation where you’re behind on mortgage payments, now is the time to capitalize on the state the bank is in and be sure to avoid a foreclosure that may linger on your credit for up to seven years.