It didn’t appear very widely in the news, but it appears that the two government-sponsored agencies (GSEs) responsible for mortgages, Fannie Mae and Freddie Mac, have suspended their eviction procedures for people living in foreclosed homes through the New Year. You can read about it here on The Huffington Post. Here are a few things you need to know about the details.
One, there’s a difference between a foreclosure moratorium and an eviction moratorium. A foreclosure moratorium stops the foreclosure proceeding, which means all the legal procedures lenders must go through to reclaim title to a property, initiate the foreclosure sale, and evict the residents if they are still present. The eviction moratorium that’s going into effect refers only to that process. Whether the residents can maintain their ownership of the property has already been decided.
So, when exactly will eviction procedures resume? For those whose mortgages are held by Freddie Mac, it begins on Monday, December 17, 2012 and goes until Wednesday, January 2. Homeowners whose mortgagee is Fannie Mae, by contrast have from December 19 until January 2, and it only applies to single-family dwellings and two- to four-unit properties. The good news, according to The Huffington Post site, is that the GSEs aren’t the only lenders who are suspending evictions. JPMorgan Chase, Wells Fargo, and Bank of America are also halting evictions.
What effect this will have, the article doesn’t say. The moratorium probably is more about PR than anything else. It’s unlikely that many families are planning to move into a newly auctioned home in January, so the banks are probably not losing a lot of money on it. Nor does the article say precisely how many evictions will be suspended.
Nevertheless, it’s important to track any mail you get from your mortgage company to see if you are eligible for the moratorium. Even if you are, it’s probably a good idea to use the extra time to remove valuable property and store it at a friend’s or a relative’s place. Anything else that’s replaceable can go to storage facilities. Beyond that, if you are about to be evicted, filing bankruptcy won’t let you keep your home, but if there’s a deficiency on your mortgage, a Chapter 7 filing can clear it.
For answers to more questions about bankruptcy, the automatic stay, effective strategies for dealing with foreclosure, and protecting your assets in bankruptcy please feel free to contact experienced Brooklyn NY foreclosure attorneys Bruce Weiner for a free initial consultation.
