Coronavirus Crisis: Rent, Mortgages, And Evictions
The CARES Act included protections for homeowners with federal loans and renters in public or assisted housing.
Federal Eviction and Relief Measures
Homeowners with FHA, USDA, VA, or Section 184 or 184A mortgages (for members of federally-recognized tribes) and those with mortgages backed by Fannie Mae or Freddie Mac have the right to request forbearance on their payments for up to 6 months, with a possible extension for another 6 months without fees, penalties, or extra interest. Homeowners should contact their mortgage servicing company directly.
Renters residing in public or assisted housing, or in a home or apartment whose owner has a federally-backed mortgage, and who are unable to pay their rent, are protected from eviction for 4 months. Property owners are also prohibited from issuing a 30-day notice to a tenant to vacate a property until after the 4-month moratorium ends. This protection covers properties that receive federal subsidies such as public housing, Section 8 assistance, USDA rural housing programs, and federally-issued or guaranteed mortgages. Renters whose landlord is not abiding by the moratorium should contact the relevant federal agency that administers their housing program or their local Legal Aid office.
On March 16, 2020, California Governor Gavin Newsom issued an executive order that authorizes local governments in California to halt evictions for renters and homeowners, slows foreclosures, and protects against utility shutoffs for Californians affected by COVID-19.
California Eviction Moratorium
California issued a statewide moratorium on residential evictions for renters who cannot pay their rent because of COVID-19 related economic hardships. The moratorium went into effect on March 27 and is valid through May 31, 2020.
If COVID-19 has impacted your ability to pay all or part of your rent, you should:
If your landlord is attempting to evict you for not paying rent and you took all of the above steps, contact a local legal aid provider.
Relief from financial institutions
The State of California is working to soften the financial impact of COVID-19 on residents who are struggling to pay their mortgage and bills. Citigroup, JP Morgan Chase, US Bank, Wells Fargo, and nearly 200 state-chartered banks, credit unions, and servicers have committed to providing relief for consumers and homeowners in California.
Under the Governor’s proposal, Californians who are struggling with the COVID-19 crisis may be eligible for the following relief after contacting their financial institution:
90-day grace period for all mortgage payments
If you are impacted by COVID-19, these financial institutions will offer mortgage-payment forbearances of up to 90 days, which allow you to reduce or delay your monthly mortgage payment. In addition, they will:
Relief from fees and charges for 90 days
For at least 90 days, financial institutions will waive or refund mortgage-related late fees and other fees including early CD withdrawals.
No new foreclosures for 60 days
Financial institutions will not start any foreclosure sales or evictions.
No credit score changes for accessing relief
If you are taking advantage of this COVID-19-related relief, late or missed payments will not be shared with credit reporting agencies.
Questions and answers on financial relief
How do I get mortgage relief and/or forbearance?
You should contact and work directly with your mortgage servicer to learn about and apply for available relief. Please note that financial institutions and their servicers are experiencing high volumes of inquiries.
How long will the forbearance last?
The terms of a forbearance will be agreed to between you and your mortgage service. Financial institutions will confirm approval of and terms of the forbearance program.
What effect will this have on my credit report?
Financial institutions will not report derogatory information (e.g., late payments) to credit reporting agencies but may report a forbearance, which typically does not alone negatively affect a credit score.
How long will these programs last?
It is still unclear how severe or how long the COVID-19 impacts will be. Financial institutions have committed to necessary relief and will be assessing the ongoing conditions and necessity of continuing relief.
What if my financial institution isn’t offering this relief?
At this time, JP Morgan Chase, US Bank, Wells Fargo and Citigroup, and nearly 200 state-chartered banks, credit unions are supporting these commitments. The state will welcome any other institution that would like to meet the moment and provide much-needed financial relief to Californians.
What if I already made a payment or was hit with a fee because of COVID-19?
These measures go into effect as of March 25, 2020.
Is the mortgage relief available to businesses?
The relief is currently only available for residential mortgages.
What if my mortgage servicer is not communicative or cooperative?You can file a complaint with the Department of Business Oversight through the complaint form on the DBO website (https://dbo.ca.gov/file-a-complaint/) or by contacting the DBO Consumer Services Office at (866) 275-2677 or (916) 327-7585 via email at Ask.DBO@dbo.ca.gov.