- FHFA announces third extension of multifamily forbearance
- Extended forbearance extended to Fannie Mae and Freddie Mac properties only
FHFA Announces New Extension to COVID Forbearance Plan
The Federal Housing Finance Agency (FHFA) recently announced that Fannie Mae and Freddie Mac backed properties will continue to offer COVID forbearance to qualifying property owners through September 30 2021.
This is the third extension of this pandemic forbearance assistance.
FHFA Director Mark Calabria said, “While COVID-19 cases are declining and many homeowners continue to emerge from forbearance, many renters, who are unable to benefit from rising home prices, have not financially recovered from the pandemic.”
Owners of Enterprise-Backed Multifamily Mortgages Can Get New or Modified Forbearance Agreements
Property owners with Fannie or Freddie backed multifamily mortgages have the option of either entering into a new or modified forbearance agreement.
Those property owners who agree to a new or modified forbearance agreement MUST:
- Inform their tenants in writing about these tenant protections through September 30 2021 and also must post tenant protections to their multifamily property websites
- Agree to NOT evict tenants for nonpayment of rent through September 30 2021
- Must give tenants a minimum of a 30-day notice to vacate the apartment
- Must not charge tenants late or penalty fees for nonpayment of rent
- Must allow tenants flexibility in repayment of back-rent over time…no lump sum repayments
Extension on Eviction Moratorium May Go to US Supreme Court
Court battles about the Centers for Disease Control and Prevention(CDC) moratorium on evictions have been ongoing since May.
Judge Dabney Friedrich with the US District Court for the District of Columbia struck down the CDC’s moratorium on evictions. Judge Dabney said the administration had exceeded authority with the moratorium via the administration’s use of the Public Health Service Act of 1944.
Then in June, the District of Columbia’s Circuit Court of Appeals ruled to let the federal prohibition on evictions stand.
This legal battle may continue up to the US Supreme Court
Where Do Enterprise-Backed Multifamily Property Owners Go From Here?
Bonnie Y. Hochman Rothell, partner and chair of the Litigation practice with Morris, Manning & Martin LLP, said, “I’m telling my clients that they need to still be in a holding pattern if the sole basis for an eviction is failure to pay rent.”
Rothell continued. “You have to look at it from a state-by-state basis. Even if the CDC moratorium is no longer in effect, there could be a local jurisdiction that would still prevent an eviction.”
Thanks to the Federal Housing Finance Agency and GlobeSt.com.
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