In Florida, there is currently a moratorium in place regarding the filing and prosecution of
mortgage foreclosure and residential eviction actions relating solely to non-payment of rent. As of the date of this memo, the current moratorium is set to expire at 12:01 a.m. on August 1, 2020.
Governor Executive Order No. 20-94 (Florida)
On April 2, 2020, Governor DeSantis issued an executive order (E.O. 20-94) suspending and tolling “any statute providing for a mortgage foreclosure cause of action under Florida Law for 45 days…including any extensions”. E.O. 20-94 also suspended and tolled “any statute providing for an eviction cause of action under Florida law solely as it relates to non-payment of rent by residential tenants… for 45 days…including any extensions”. A copy of E.O. 20-94 is attached. This order was subsequently extended.
Governor Executive Order No. 20-159 (Florida)
On June 30, 2020, Governor DeSantis issued E.O. 20-159, which extended E.O. 20-94 until 12:01
a.m. on August 1, 2020, thereby keeping the current moratorium in place. A copy of E.O. 20-159 is attached.
At this time, while we have been able to prosecute pending mortgage foreclosure cases on a limited basis in some Counties in Florida, we have been unable to file new mortgage foreclosure or residential evictions actions relating solely to non-payment of rent due to the current moratorium.
CARES Act – Section 4024
Signed into law on March 27, 2020, Section 4024 of the CARES Act immediately put in place a moratorium on evictions for non-payment of rent for tenants in properties that are currently in a housing program, rural housing voucher program, or covered by a federally backed loan. A federally backed loan includes all federal programs (VA, FHA, USDA, FNMA, FHLMC, etc.). The moratorium is set to expire on or about July 25, 2020 (120-days after enactment). However, once the period expires, a landlord must provide at least a thirty (30) day notice to tenant to pay the back-owed rent or vacate. Please note this 30-day notice cannot be sent prior to the end of the120-day moratorium.
A CARES Act Eviction Moratorium memo from the Congressional Research Service is attached for further information.
Current GSE Moratoriums
Aside from the moratorium imposed under the CARES Act, on June 17, 2020, the Federal Housing Finance Agency (FHFA) announced that Fannie Mae and Freddie Mac would extend their moratorium on foreclosure and evictions for single-family residential properties until August 31, 2020. On the same date, the Department of Housing and Urban Development (HUD) announced that the Federal Housing Administration would also be extending their moratorium on foreclosure and evictions for single-family residential properties until August 31, 2020.
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STATE OF FLORIDA
OFFICE OF THE GOVERNOR EXECUTIVE ORDER NUMBER 20-94
(Emergency Management – COVID-19 – Mortgage Foreclosure and Eviction Relief)
WHEREAS, Novel Coronavirus Disease 2019 (COVID-19 ) is a severe acute respiratory illness that can spread among humans through respiratory transmission and presents with symptoms similar to those of influenza; and
WHEREAS, on March I, 2020, I issued Executive Order number 20-51 directing the Florida Department of Health to issue a Public Health Emergency; and
WHEREAS, on March 1, 2020, the State Surgeon General and State Health Officer declared a Public Health Emergency exists in the State of Florida as a result of COVID-19; and
WHEREAS, on March 9, 2020, I issued Executive Order 20-52 declaring a state of emergency for the entire State of Florida as a result of COVID-19; and
WHEREAS, on March 18, 2020, President Donald J. Trump announced that the Department of Housing and Urban Development (“HU D”) authorized the Federal Housing Administration (“FHA”) to implement an immediate foreclosure and eviction moratorium for FHA-insured single-family mortgages for 60 days due to the COVID-19 emergency; and
WHEREAS, on March 18, 2020, the Federal Housing Finance Agency (“FHF A”) directed Fannie Mae and Freddie Mac to suspend foreclosures and evictions for Enterprise-backed single-family mortgages for at least 60 days due to the COVID-19 emergency; and
WHEREAS, I find that this emergency has impacted the ability of many Floridians with single family mortgages to make their mortgage payments; and
WHEREAS, I find that providing targeted, temporary relief to Floridians with single- family mortgages is in the best interest of the state and its people; and
WHEREAS, I find that this emergency has impacted the ability of many Floridians with residential tenancie s to make their rent payments; and
WHEREAS, I find that providing targeted, temporary relief to Floridians with residential tenancies
is in the best interest of the state and its people; and
WHEREAS, as Governor, I am responsible for meeting the dangers presented to this state and its people by this emergency.
NOW, THEREFORE, I, RON DESANTIS, as Governor of Florida, by virtue of the authority vested in me by Article IV, Section (l)(a) ofthe Florida Constitution, Chapter 252, Florida Statutes, and all other applicable laws, promulgate the following Executive Order to take immediate effect:
Section I. J hereby suspend and toll any statute providing for a mortgage foreclosure cause of action under Florida law for 45 days from the date of this Executive Order, including any extensions.
Section 2. I hereby suspend and toll any statute providing for an eviction cause of action under Florida law solely as it relates to non-payment of rent by residential tenants due to the COVID-19 emergency for 45 days from the date of this Executive Order, including any extensions.
Section 3. Nothing in this Executive Order shall be construed as relieving an individual from their
obligation to make mortgage payments or rent payments.
STATE OF FLORJDA
OFFICE OF THE GOVERNOR EXECUTIVE ORDER NUMBER 20-159
(Limited Extension of Mongage Foreclosure and Eviction Relief)
WHEREAS, Executive Order20-94, as extended by Executive Orders20-121 and 20-137, expires on July I, 2020 , unless extended.
NOW, THEREFO RE, I, RON DESANTIS, as Governor of Florida, by vinue of the authority vested in me by Anicle IV, Section ( l)(a) of the Florida Constitution, Chapter 252. Florida Statut,es and all other applicable Jaws, promulgate the following E. ecutive Order to take immediate effect:
Section I. I hereby extend Executive Order 20-94, as extended by Executive Orders 20- 121 and 20-137, until 12:01 a.m. on August I, 2020.
IN TESTIMONY WHEREOF, I have hereunto set my hand and caused the Great Seal of the State of Florida to be affixed, at Tallahassee, this 30th dayof June, 2020.
CARES Act Eviction Moratorium
April 7, 2020
The COVID-19 pandemic has disrupted business operations nationwide, leading to dramatic job losses that threaten the ability of many to meet their financial obligations, including housing rental payments. To aid individuals and businesses harmed by the pandemic, Congress passed the Coronavirus Aid, Relief,
and Economic Security (CARES) Act (P.L. 116-136).
Section 4024 of the CARES Act provides a temporary moratorium on eviction filings as well as other protections for tenants in certain rental properties with federal assistance or federally related financing. These protections are designed to alleviate the economic and public health consequences of tenant displacement during the COVID-19 outbreak. They supplement temporary eviction moratoria and rent freezes implemented in states and cities by governors and local officials using emergency powers . While Section 4024′ s tenant protections are narrower in scope than those proposed by some law makers, called for by some tenant-advocates , or enacted in some other countiies, they represent arguably unprecedented action by the federal government in an area of law that, largely, states and localities traditionally govern. Thus, questions remain about the law’s effects on tenants, landlords, and rental markets.
Eviction and Rental Payment Protections
CARES Act Section 4024(b) prohibits landlords of certain rental “covered dwellings” from initiating eviction proceedings or “charg[ing] fees, penalties, or other charges” against a tenant/or the nonpayment of rent. These protections extend for 120 days from enactment (March 27, 2020).
Section 4024(c) requires landlords of the same properties to provide tenants at least 30 days-notice before they must vacate the property. It also bars those landlords from issuing a notice to vacate during the 120- day period. In contrast to the eviction and late fee protections of Section 4024(b), which are expressly limited to nonpayment, Section 4024(c) does not expressly tie the notice to vacate requirement to a particular cause. Thus, Section 4024(c) arguably prohibits landlords from being able to force a tenant to vacate a covered dwelling for nonpayment or any other reason until after August 24, 2020 (i.e., 120 days after enactment, plus 30 days after notice is provided).
Section 4024(b)’ s and (c)’ s protections, however, do not absolve tenants of their legal responsibilities to pay rent. Tenants who do not pay rent during the eviction grace period may still face financial and legal liabilities, including eviction, after the moratorium ends.
What Properties Does the CARES Act Protect?
The CARES Act’s eviction protections only apply to “covered dwellings,” which are rental units in properties: (1) that participate in federal assistance programs, (2) are subject to a “federally backed mortgage loan,” or (3) are subject to a “federally backed multifamily mortgage loan.”
Covered federal assistance programs include most rental assistance and housing grant programs, including public housing, Housing Choice \buchers, Section 8 Project-Based RentalAssistance, rural housing programs, and the Low Income Housing Tax Credit (LIHTC) program.
A “federally backed mortgage loan” is a single-family (1-4 units) residential mortgage owned or securitized by Fannie Mae or Freddie Mac or insured, guaranteed, or otherwise assisted by the federal government. The term includes mortgages insured by the Federal Housing Administration and the Department of\eterans Affairs, and the Department of Agriculture’s direct and guaranteed loans. The act defines a “federally backed multifamily mortgage loan” ahnost identically to “federally backed mortgage loan” except that it applies to properties designed for five or more families.
The unique nature of the CARES Act Section 4024 tenant protections raises several questions.
First, how many of the nation’s roughly 43 million renters live in “covered dwellings”? Researchers estimate that roughly 12.3 million rental units have federally backed financing, representing 28% of renters. Other data show more than 2 million housing vouchers along with approximately 5 million federally assisted rental units. However, these data do not include every covered program and likely include duplicate properties because federal assistance can be provided to units with federally backed loans. Renters not covered by the federal moratorium could be covered by a state or local moratorium.
Second, how will people know they are covered? While some renters living in federally assisted units may know they are assisted, unassisted renters are unlikely to know the mortgage status of their unit. Property owners may know if their mortgages are federally insured because they must have applied for the insurance. However, owners might not know whether Fannie Mae or Freddie Mac subsequently purchased their loans from their lenders because owners are not parties to these transactions. The opacity of this information raises questions about enforcement of the protections.
Third, if tenants do not make rent payments during the moratorium, what are the financial ramifications for landlords, tenants, and housing markets? Relief programs established under the CARES Act and other government-provided assistance could mitigate the financial impact of missed rent payments. Landlords, for example, may be eligible for mortgage forbearance or small business loans and grants provided under different provisions of the CARES Act. Tenants may also be eligible for the act’s direct payments to individuals and enhanced unemployment compensation. These programs might ease the financial burdens of some landlords and tenants, but are unlikely to offset all fmancial burdens stemming from the pandemic.
The CARES Act does not address how landlords can respond to missed payments after the moratorium ends. While the act bars landlords from charging late fees and other penalties because of a tenant’s
uring the 120 days, whether or not late fees and interest on rental payments are prohibited during the grace period and being charged after it ends is unclear.
day period, landlords presumably could move to evict tenants who did not meet their rental bject to the CARES Act’s 30-day notice requirement and consistent with state and local ran eviction wave will come at the end of the moratorium is unclear. Landlord eviction likely be affected by local rental market conditions at the time, including the extent to which other renters have suffered financial hardship during the pandemic, and whether landlords can successfully negotiate repayment plans with tenants.