Feds warn landlords: ‘We’re watching’

The heads of the Federal Trade Commission and Consumer Financial Protection Bureau  have warned landlords that they are monitoring and ready to take action if landlords are not honoring the moratorium on evictions put into place to help people facing economic hardship because of Covid-19.

The Centers for Disease Control and Prevention 0n March 29 extended an order aimed at preventing evictions through June. The moratorium had been due to expire March 31.

FTC acting Chairwoman Rebecca Kelly Slaughter and CFPB acting Director Dave Uejio in a joint statement said, “There are reports that major multistate landlords are forcing people out of their homes despite the government prohibitions or before tenants are aware of their rights. Depriving tenants of their rights is unacceptable. Many of the tenants at risk of eviction are older Americans and people of color, who already experience heightened risks from COVID-19.

“Staff at both agencies will be monitoring and investigating eviction practices, particularly by major multistate landlords, eviction management services and private equity firms to ensure that they are complying with the law,“ their statement said.

“Evicting tenants in violation of the CDC, state or local moratoria, or evicting or threatening to evict them without apprising them of their legal rights under such moratoria, may violate prohibitions against deceptive and unfair practices, including under the Fair Debt Collection Practices Act and the Federal Trade Commission Act,” Slaughter and Uejio said. “We will not tolerate illegal practices that displace families and expose them and by extension all of us to grave health risks.”

A new report from the CFPB warned of widespread evictions and foreclosures once pandemic protections lapse unless there is additional public and private action. The report found that almost 11 million families were behind on their rent or mortgage payments going into 2021. The CFPB found there were 2.1 million families behind by at least three months on mortgage payments and 8.8 million households that were behind on rent.

According to the CFPB, homeowners are estimated to owe almost $90 billion in missed payments.

Recent actions by the Federal Housing Finance Agency, the Federal Housing Administration, the Department of Veterans Affairs and the U.S. Department of Agriculture prohibit lenders from foreclosing on most mortgages until June 30 of this year.

The report noted that people who live in manufactured homes, such as mobile homes, may not have mortgages that are covered by the nonforeclosure regulations and are at greater risk than people living in standard structures.

The CFPB found that Black and Hispanic families are more than twice as likely to report being behind on housing payments than white families.

The CFPB collected data showing that about 9% of people who rent believe they are likely to be evicted as a consequence of the pandemic while 18% of people who live in small to midsize multifamily buildings report being behind in payments.