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Stimulus Plan Could Stop Flood of Foreclosures and Evictions

By MNR News posted 02-10-2021 10:32 AM

  

Without aid, millions impacted by Pandemic could begin losing their homes in April 

Although the American economy has recovered to some degree since the record 14.7% unemployment rate of April 2020—the worst since the Great Depression—millions are still out of work. As the economic effects of the pandemic continue roiling the nation, many struggle to pay mortgages and rent. The $1.9 trillion stimulus plan announced in mid-January by the Biden Administration would extend the national moratorium on foreclosures and evictions until September 2021. 

 

For millions of Americans, this aid cannot come soon enough. As unprecedented numbers of people lost their jobs in 2020, countless distressed homeowners turned to forbearance, federally backed plans that provide payment relief for up to one year without late charges or penalties. By May 2020, more than 4 million mortgages were in forbearance, representing $1 trillion in mortgage debt. In April or May of this year, many of these forbearance plans are scheduled to expire, threatening to unleash a flood of foreclosures.  

 

The stimulus plan would attack foreclosures, evictions, and the threat of homelessness on several fronts: 

 

  • Extend application period for forbearance aid until September 30, allowing struggling borrowers more time to request assistance 
  • Provide legal assistance to those facing foreclosure or eviction 
  • Allocate $25 billion in rental assistance 
  • Distribute billions in emergency assistance to state and local governments for those who are currently homeless or at risk of becoming homeless 

 

Lastly, the plan would distribute $1,400 stimulus checks to millions of Americans, providing a boost for other living expenses. Learn more by reading Biden Plan Calls for $25B in Rental Assistance, Extending Eviction Ban in NAR’s Realtor Magazine

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