COVID-19 Foreclosures and Evictions

Dated: 03/24/2020

Views: 682

Foreclosure

Many homeowners and renters are concerned about foreclosures or evictions during this COVID-19 State of Emergency. In an effort to help clear up some confusion, we decided to compile the information in one central location. We hope that this info helps anyone who is concerned about foreclosure or eviction.


I have a government-insured loan

Government Insured Loans

On Wednesday, March 18th, HUD Secretary Ben Carson authorized an immediate foreclosure moratorium for government-insured loans for the next 60 days. Please understand that you should still make your loan payment if you are able. This is not a free pass! It simply means that you cannot be foreclosed on at this time. At the end of the moratorium, if you are delinquent on your mortgage, the loan company can begin the foreclosure process. It is imperative that you contact your mortgage company to discuss your options, which may include short- or long-term forbearance (meaning your payment is delayed but interest still accrues) or mortgage modifications (which could be a reduction in the interest rate, an extension of the length of time for repayment, or a different type of loan). Here is the HUD foreclosure announcement as well as the letter regarding the moratorium.


I have a conventional loan

Conventional Mortgage

The foreclosure moratorium does NOT apply to conventional loans or owner-financed properties. If you are unable to make your full mortgage payment, you MUST contact your lender to discuss your options. You could potentially be offered forbearance (delay your payment but interest still accrues) or modification (reduction in the interest rate, extension of the length of time for repayment, different type of loan, or any combination of the three). Most lenders would much rather work with you to restructure your loan rather than go through the foreclosure process, but you MUST reach out to them.


I don't know what type of loan I have

Unsure

If you are unsure whether you have a government-insured or conventional mortgage, please contact your mortgage company. They will be able to tell you what type of loan you have.


I am a renter

On March 19th, the Texas Supreme Court issued an emergency order prohibiting eviction hearings until after April 19th. Please understand, though, that if the JP Courts in your county are still open, your landlord can still file for eviction if you are delinquent in rent (although a hearing could not occur until after April 19th). Exceptions to this delay can be made if there is an imminent threat of physical harm.

If you have experienced a loss of income due to COVID-19 and are unable to pay your rent, you MUST reach out to your landlord and talk to him/her about your situation. The landlord may work with you to arrange a repayment or deferment agreement, but at this time, landlords are not REQUIRED to do so. Your landlord may ask for proof of your income loss, so be prepared to provide some sort of documentation.


I am a student and have had to move out because my school shut down

If you are a student who rents off-campus housing but you have had to move out due to your university going online-only for the remainder of the semester, you still have to pay your rent. University-provided student housing (think dorm) is a bit tricky, and each university will have their own policy for that, so be sure to reach out to your university to find out if they are offering partial reimbursement, credit, etc.


Closing Thoughts & Reminders

Please remember that whether you are a home-owner or a renter, you signed a contract that you are still legally bound to. Even if your landlord/mortgage company allows to you “skip” payments for 30, 60, 90+ days, that does not mean that you just don’t owe that money anymore. Please make every effort to make your rent or mortgage payment if you are able. If you are unable, you MUST reach out and communicate with your landlord or mortgage company. And don't forget--a little bit of kindness goes a long way, so please be patient and kind when communicating with your landlord or mortgage company!

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