Multifamily Owners in Forbearance Must Now Tell Tenants
WASHINGTON – On Thursday, the Federal Housing Finance Agency (FHFA) announced that multifamily property owners who received mortgage forbearance from Fannie Mae or Freddie Mac (the Enterprises) must inform tenants in writing about the mandated tenant protections during the forbearance and repayment periods.
Some tenants have had trouble meeting their monthly rent obligations that, in turn, created problems for multifamily owners. An offer of forbearance – the ability to temporarily avoid monthly payments – was created to help these owners during a drop in rents. However, multifamily owners who accepted forbearance also agreed not to evict tenants during that forbearance simply because they failed to make a rent payment.
FHFA previously announced additional tenant protections that apply during the repayment periods. Those include:
- Giving tenants at least a 30-day notice to vacate
- Not charging tenants late fees or penalties for nonpayment of rent
- Allowing tenants flexibility to repay back rent over time and not in a lump sum
“Landlords in forbearance must notify their tenants that they cannot be evicted for nonpayment of rent due to the pandemic,” says Director Mark Calabria. “If tenants are able to pay their rent, they should continue to do so.”
In addition to the mandatory tenant notification, Fannie and Freddie say they’re also improving their online multifamily tools, with tenant protections posted on the look-up tools’ landing page. They’re also making it easier for tenants to find out if their multifamily property has an Enterprise-backed mortgage.
FHFA says it will keep monitoring the coronavirus’ impact on tenants, borrowers, and the mortgage market, and update policies as needed.
For more information on pandemic-related housing assistance, visit the joint website operated by the Department of Housing and Urban Development, FHFA and CFPB: cfpb.gov/housing.
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