Fannie, Freddie, FHA offer some tenants relief as eviction ban ends

One day before the federal eviction ban was to expire, the Federal Housing Administration, the Department of Veterans Affairs and a government-sponsored enterprise oversight agency extended relief for certain tenants.

The FHA, Veterans Affairs and the Federal Housing Finance Agency announced separately on Friday that they’re extending moratoria on evictions from single-family real-estate owned properties through Sept. 30, following a recommendation by the Biden administration.

Mortgage servicers can proceed with certain foreclosures after a ban on these ends on July 31, but no evictions of the renters on the properties involved can take place until the end of September, according to the FHA.

Single-family real-estate owned loans are either in foreclosure or are being settled through a deed-in-lieu of one, and the greater leeway being given to tenants in these properties signals that government officials consider it a priority to keep them housed.

“The pandemic continues to have an outsized impact on the ability of Americans to meet their monthly rent or mortgage payments. Today’s extension of the eviction moratorium protects particularly vulnerable Americans who otherwise would be at risk of losing a place to live,” Sandra Thompson, acting director of the FHFA, said in a press release.

Many factors could make a case for additional relief for renters, such as concern that vaccinations won’t be fully effective against new variants of the coronavirus, the fact that rental relief money is still in the midst of a roll-out, and that the reversal in the jobs lost amid the pandemic is not yet complete. The majority of positions lost between the first quarter of 2020 and 1Q21 won’t be recovered until after September, according to a recent Moody’s Investors Service report.

However, several counterarguments to extending the federal eviction ban exist, too. A landlord group filed a suit this week aimed at recovering damages from the ban, and the Centers for Disease Control and Prevention’s moratorium is subject to a court restriction that makes it difficult to extend.

“Given the recent spread of the Delta variant, including among those Americans both likely to face evictions and lacking vaccinations, President Biden would have strongly supported a decision by the CDC to further extend this eviction moratorium,” the White House said in a statement released Thursday. “Unfortunately, the Supreme Court has made it clear that this action is no longer available.”

Earlier this week the FHFA also added multifamily tenant protections that require landlords with loans from government-sponsored enterprises Fannie Mae and Freddie Mac to provide a 30-day notice before evicting tenants for nonpayment of rent.