Extension and Expansion of State Eviction Moratorium

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On April 16, 2020, Governor Inslee issued Proclamation 20-19.1 that extended and expanded the scope of the state-wide eviction moratorium contained in Proclamation 20-19.  The moratorium had been set to expire on April 17, 2020.  The following is a summary of the provisions of Proclamation 20-19.1.  You can find the proclamation here.

The proclamation:

  • Extends the current residential eviction prohibition to June 4, 2020.
  • Expands the moratorium to prohibit residential evictions for ANY reason – not just for failure to pay rent – including holdover tenancies.  Note: In this way, it is now similar to the City of Seattle’s eviction moratorium.
  • Specifies that law enforcement is not to serve or otherwise act on eviction orders.
  • Includes a general exception to the moratorium if the eviction is necessary to prevent a residential tenant from endangering the health and safety of others – but not if the threat is due to the resident’s disability or health condition or is the result of the tenant following social distancing/quarantine guidelines. Note: This is also similar to the exception in Seattle’s eviction moratorium.
  • Prohibits the charging of rent, interest or late fees if a residential tenant is unable to access the leased premises because of the COVID-19 outbreak.
  • Prohibits the charging of interest or late fees to all other residential tenants who fail to pay rent when due.
  • Prohibits actions to collect unpaid rent and charges from residential tenants that have accrued because of the COVID-19 outbreak, unless the landlord has offered a “reasonable” payment plan (determined by considering the resident’s particular circumstances) and the tenant refused the offer or accepted it and failed to comply with the plan.  Note: Presumably, since the proclamation states the activities included in the proclamation are prohibited only through June 4, 2020, this restriction only applies to unpaid rent and the resulting collection activities occurring from now until June 4th.  However, extension of this prohibition is likely even if the remainder of the proclamation is not extended beyond June 4th.
  • Prohibits landlords from increasing rents during the pendency of the proclamation.  This prohibition includes commercial leases if the commercial tenant has been “materially impacted” by COVID-19 either personally or due to a forced closure or loss of business.  Note: This restriction goes beyond the limits included in a bill recently passed by the Seattle City Council (see description here) since it isn’t limited to small businesses and doesn’t have an exception for rent increases built into existing leases.  On the other hand, it doesn’t require landlords to accept repayment plans offered by tenants.
  • Encourages tenants to pay what they can to support landlords.

CARES Act Forbearance and Eviction Protection Provisions

Moratoria similar to the eviction moratorium of Proclamation 20-19.1 are found in the federal CARES Act.  The CARES Act is comprised of various programs intended to provide relief from the economic impacts of COVID-19 pandemic.  The following is a summary of moratoria contained in the CARES Act regarding foreclosure and eviction prohibitions:

  • Moratorium on foreclosures (forbearance) of residential mortgage loans.
    • Borrower must request the forbearance, by:
      • Applying to loan servicer, and
      • Affirming it is experiencing financial hardship due to the COVID-19 pandemic
      • Forbearance must be granted for 180 days and the borrower shall have an option to extend for another 180 days. There shall be no accrual of interest or fees during forbearance.
    • “Federally backed” mortgage loans include those that are:
      • Insured and/or guaranteed by FHA, the VA or other federal agencies;
      • Made by the Department of Agriculture; or
      • Purchased by Freddie Mac or Fannie Mae
    • A forbearance can be requested until the Federal COVID-19 Emergency declaration is terminated or December 31, 2020, whichever is sooner.
  • Forbearance of multifamily mortgage loan payments and eviction protection.
    • Applies to “federally backed” multifamily mortgage loans
      • Borrower must submit a request to the loan servicer and document financial hardship – not just attest to hardship
    • Forbearance is for only 30 days with up to two extensions of 30 days at the borrower’s request
    • Borrower cannot evict or initiate eviction of tenants in the subject property or charge such tenants late fees/fines for failure to pay rent during forbearance period
    • Borrower cannot issue notices to vacate to tenants of the subject property during forbearance period
    • “Federally backed” multifamily mortgage loans include those that are:
      • Made, insured and/or guaranteed by HUD or other federal agencies; or
      • Purchased by Freddie Mac or Fannie Mae
    • A request for forbearance must be submitted before the Federal COVID-19 Emergency declaration is terminated or December 31, 2020, whichever is sooner
  • Eviction Moratorium.
    • Prohibits eviction or initiation of eviction or the charging of late fees/fines for failure to pay rent
    • Landlords may not issue notices to vacate during the moratorium
    • In effect for 120 days from the enactments of the CARES Act (March 27, 2020) Note: This moratorium may extend beyond the moratorium connected to the multifamily mortgage loan forbearance provision since is not limited to the forbearance period.
    • Applies to federally backed mortgages
      • See definition for multifamily mortgage loan forbearance
      • Also includes properties participating in the Violence Against Women housing program and rural housing voucher program.

Federally backed home loans constitute the majority of such loans regardless of the company servicing your loan, i.e. to whom you send payments.  Therefore, it would be worthwhile for you to determine if your particular mortgage falls under this category.

Please note that under all of these moratoria, tenants and borrowers remain obligated to pay any rent or make any mortgage payments that come due while the moratoria are in place.  Therefore, even if a program does not require or encourage one, it is in your best interest to begin discussing with your landlord or lender a repayment plan that would be put in place once the moratoria are lifted.  Waiting until the applicable moratorium has expired before committing to a repayment plan is advised since you may not know the full amount you owe until then.  Not only will the amount you owe in back rent or mortgage payments depend on the duration of the emergency and changes to your employment status over the course of the emergency, but rent/mortgage support programs may be instituted in the meantime that would reduce the amount due during the COVID-19 crisis or legislation may dictate the terms of prepayment plans.

Please contact us if you have any questions about the application of these moratoria.

 


About the Authors

Scott Johnson

Scott’s practice is focused on Environmental Law and he advises clients in the purchase, development and remediation of contaminated property.

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