Alabama COVID Foreclosure Eviction Moratorium Ending

COVID & CARES Act: The National Foreclosure and Eviction Moratorium is Ending on June 30th & I’m behind on my payments, now what?

Like we mentioned in our last blog post, this month our office’s main focus is on helping our clients throughout Alabama prepare their finances for the ending of multiple COVID-19 pandemic assistance programs. At the end of this month, on June 30, 2021, the national foreclosure moratorium and national eviction moratorium will both end. If you are behind on your mortgage payments or rent payments, are in active forbearance, or are afraid that foreclosure is on the horizon for you and your household- we recommend that you keep reading to further educate yourself on these programs and call our office at 205-349-1280 to set up a free consultation.

On March 27, 2020 the CARES Act (The Coronavirus Aid, Relief, and Economic Security Act) was passed and signed into law by the U.S. Congress and then President, Donald Trump. While this act had many facets to help Americans respond to the economic fallout of the COVID-19 pandemic, some of the most well-known included the direct stimulus check payments and the moratorium on foreclosures and evictions. Since then, there have been three unique rounds of direct stimulus check payments made in varying amounts to eligible Americans and the foreclosure and eviction moratorium has been extended almost 18 months in total.

The foreclosure moratorium meant that no foreclosures could take place until July 1, 2021. It should be noted that the foreclosure moratorium only applied to single-family homes with mortgage loans that are backed by federally funded agencies, Fannie Mae, Freddie Mac, FHA (Federal Housing Administration), USDA (United States Department of Agriculture), HUD (the Department of Housing and Development) and the VA (Department of Veterans Affairs). It should also be noted that other private companies and lenders within the housing finance market with non-federally backed funding could comply with this moratorium if they chose and were encouraged to actively work with their borrowers, but were not required to – which is why many Alabamians and Americans have still faced foreclosure and eviction processes throughout the COVID-19 pandemic.

Now, as the final deadline of this moratorium, June 30, 2021, approaches – many federally backed mortgage agencies and rental properties owned by federal government agencies are preparing to resume foreclosures and eviction processes with their residents and it is estimated that nearly 4.2 million Americans will face foreclosure and eviction beginning as soon as the next two months. According to a Census survey released earlier this month, approximately 28% of Alabamians report that they are behind on their housing payments and face foreclosure or eviction proceedings.

If you are among those facing foreclosure soon, in active mortgage forbearance, are delinquent on your mortgage payments, or behind on your rent payments – we recommend a few different steps to seeking assistance:

  1. Reach out to your mortgage company and see if you qualify for any assistance programs. Again, this moratorium has only applied to federal agencies and properties so each private company has been handling their delinquency processes as they see fit. Bank of America’s CEO, Brian Moynihan has said they plan to align with the July 1, 2021 date of actively resuming foreclosures. Meanwhile, a spokesperson from Wells Fargo has said they support the Consumer Financial Protection Bueau’s proposed rule to further delay foreclosure proceedings until 2022. We recommend reaching out to your individual company and asking about your assistance options and doing so before June 30, 2021.
  2. If you’re a renter or a landlord, you can visit Alabama’s Emergency Rental Assistance website to apply and see if you qualify for further state-funded assistance. We recommend doing so before the deadline of June 30, 2021.
  3. Reach out to our office, Eric Wilson Law, at 205-349-1280 or a local bankruptcy attorney in your area to find out if bankruptcy might be the best option for you to prevent foreclosure, catch up after forbearance, or even recover from past evictions.

If you’re living in Northern or Western Alabama and unsure of where to begin and your family’s housing future is uncertain as these assistance programs come to an end, call our office at 205-349-1280 and schedule a free consultation phone appointment with Attorney Eric Wilson regarding Chapter 7 or Chapter 13 Bankruptcy so that we can help you keep your property protected. We are here to help!