Still unable to pay your rent or mortgage? Here’s how the new stimulus plan will help

Still unable to pay your rent or mortgage? Here’s how the new stimulus plan will help

by

The plan includes $ 27 billion in rent relief, $ 10 billion in mortgage relief and $ 5 billion to address homelessness.

While this unprecedented amount of aid will provide relief for millions, it is still not enough to cover the continuing need for housing assistance, said Diane Yentel, president and CEO of the National Low Income Housing Coalition.

At the end of February, 13.5 million people said they were in arrears with their rent – nearly 1 in five of all tenants – according to an analysis by the Center for Budget and Policy Priorities from a census bureau survey. Tenants owe an estimated $ 57 billion in rent, according to the Moody’s Analytics report.

There are currently 2.6 million homeowners in a tolerance program that enables them to defer or defer their payments according to Black Knight. At the end of January, there was about $ 19 billion in interest and arrears due to the pandemic, the mortgage company said.

“The joint funding of this bill and the previous bill could address most, if not all, arrears,” Yentel said. “But more will be needed for ongoing challenges.”

Rent lighting

The main source of rent relief in the new law is $ 21.55 billion in first aid. The funding will be added to the $ 25 billion in aid already allocated to states and communities in December to help families pay rent and utilities and stay in their homes.
According to Yentel, according to the database of her organization that monitors relief, most of the December funds have not yet reached tenants or their landlords. (Direct links to programs that offer state and local first aid programs across the country can be found on the NLIHC website, and other information on home help programs can be found on the Financial Consumer Protection Bureau’s website.)

But there are other sources of rent relief in the new package that are more targeted. For example, $ 100 million has been set aside for people living in USDA-subsidized rural properties who are struggling to pay rent.

For homeless people, the law includes $ 5 billion in evidence for emergency housing. Another $ 5 billion has been earmarked to create out-of-group housing and shelters.

To address the increase in housing challenges over the past year, the plan provides $ 100 million for housing counseling and $ 20 million for equitable housing organizations.

For those struggling to cover their costs, the stimulus package includes $ 4.5 billion for the low-income household energy program and $ 500 million for low-income water assistance.

Helping Homeowners

Unlike previous incentive and assistance packages, which protect certain homeowners but no direct help, the U.S. bailout plan provides $ 10 billion in direct financial assistance to struggling homeowners.

These funds are designed to help homeowners stay negative and catch up on mortgage, utility, property taxes and insurance payments, said David M. Dworkin, president and CEO of the National Housing Conference.

While the percentage of tolerance mortgages is falling – according to Black Knight, for the first time since April last year by less than 5% – there are about 800,000 treaty plans that will expire by the end of the month.

These homeowners should work with their loan service staff to decide whether to come out of tolerance and make a plan to repay the deferred amount, or to request an extension. Most pandemic-related tolerance programs will currently expire in June. Federal ban on negative will also expire in June.

The U.S. Rescue Plan Act also provides $ 39 million in assistance to low-income households that became homeowners through certain USDA mortgage programs and were left behind with their payments during the pandemic.

What is not in the account

Struggling tenants who have given their landlord a statement that they can not pay rent and that they will try their best to pay what they can, are protected from eviction by the national ban imposed by the Centers for Disease Control and Prevention. But the protection will currently expire at the end of the month.
The order was first introduced in September and was extended twice, most recently by President Biden on his first day in office.

Yentel said the eviction moratorium needs to be extended to bring in the billions of dollars still being distributed in order to support the rents owed by rents.

“There are landlords who refuse to participate in the program and watch the clock for another three weeks until they can evict their tenants,” she said.

Yentel said she would also like to see the ban strengthened and enforced.
Unpaid rent piles up. Landlords can not last forever

“The order is flawed in that there is an alarming number of evictions while it is in place,” she said. “Currently the protection is not automatic, we would like to see it change.”

According to landlord groups, the eviction moratorium still imposes an excessive burden on property owners, some of whom have not paid rent for a year.
There are currently a number of legal challenges to the CDC eviction moratorium. This court ruled in a federal court in Ohio that the CDC violated its authority to issue a nationwide expulsion ban, according to court documents. The Department of Justice is appealing a ruling by a federal judge in Texas that the federal moratorium on evictions is unconstitutional.

‘While the stimulus will make a major contribution to addressing economic problems caused by the pandemic, ongoing moratoriums on evictions will have serious, negative consequences for the millions of’ mum and baby ‘owners who own 95% of the single home rental house. industry and has struggled under long-term rental restrictions and mandates from the government, “said David Howard, executive director of the National Council for Home Home, which represents the single-family rental industry.

.Source