Lyons Gaddis COVID-19 Alert
This Alert is one in a collection of articles created by Lyons Gaddis in our effort to get important information to our clients regarding the effect of the novel coronavirus (COVID-19) outbreak in the United States. This Alert focuses on the CARES Act as it relates to tenants, landlords and borrowers.
April 1, 2020
CARES Act Protections for Tenants, Landlords and Borrowers
by Cameron A. Grant
Tenants, Landlords and Borrowers should pay close attention to the recently approved the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020. the CARES Act provides borrowers, tenants, and landlords with certain protections with respect to evictions and federally backed mortgages, including the following:
- A 60-day prohibition on foreclosures on any federally backed mortgage loans effective as of March 18th;
- Up to 180 days of forbearance (with an additional 180-day extension if necessary) for any borrowers of federally backed mortgage loans suffering a financial hardship as a result of the pandemic;
- Up to 90 days of forbearance for multifamily borrowers who have experienced a financial hardship, in exchange for an agreement not to evict tenants or charge late fees during the forbearance period; and
- A 120-day prohibition on initiating legal action to recover possession of a rental unit or to charge fees, penalties, or other charges to the tenant related to such nonpayment of rent where the landlord’s mortgage on that property is insured, guaranteed, supplemented, protected, or assisted in any way by HUD, Fannie Mae, Freddie Mac, the rural housing voucher program, or the Violence Against Women Act of 1994.
In addition to the CARES Act, Fannie Mae and Freddie Mac have issued additional orders regarding evictions and mortgage forbearance – more information found here.
Attorneys in the Real Estate Group at Lyons Gaddis are available to advise you in relation to your commercial lease matters and other COVID-19 related issues.