In the wake of COVID-19, many Americans and Georgians are experiencing income loss and financial insecurity. Changes at the federal, state, county, and city level have been enacted to protect homeowners and renters from eviction and foreclosure.
Additionally, individual taxpayers are eligible for a rebate check to provide a small amount of economic relief.
- The CARES Act provides two forms of relief for homeowners: blockage of foreclosure proceeding and the option to request 180 days of forbearance on their mortgage.
- Protection from Foreclosure – Section 4022 protects homeowners from being evicted and also prevents lenders from initiating foreclosure procedures for 60 days beginning March 18, 2020.
Additionally, Section 4022 states homeowners experiencing financial hardship related to COVID-19 can request forbearance for 180 days. Forbearance is temporary relief offered by a lender to pause or reduce payments. A request for payment deferment can be requested more than once. When forbearance is granted, late fees and penalties are not applied. Forbearance is NOT automatically provided. The homeowner must make a request.
It is important to note that these options only apply to federal mortgages made by the following agencies:
- Federal Housing Administration
- Department of Housing and Urban Development
- Department of Agriculture
- Department of Veterans Affairs
- Freddie Mac
- Fannie Mae
Over 60% of U.S. mortgages are federally-backed. Contact your service provider (the bank you make a payment to) to determine if your mortgage is federally-backed.
Many lenders are offering similar options for mortgages held by private lenders. Some states, (not Georgia as of the writing of the article) have partnered with banks to offer homeowner relief.
Renters are not automatically protected against eviction during COVID. Section 4023 of the CARES Act offers a 120-day eviction moratorium if the renter/tenant resides in:
- federally subsidized housing
- a property with a federally backed mortgage loan
The National Multifamily Housing Council has requested that evictions be suspended for renters that have been financially impacted by COVID-19. A request to avoid rent increases for 90-days was also submitted.
Protection for Georgia Renters
Georgia currently has no official eviction moratoriums in place.
On March 17th, Atlanta Mayor Bottoms issued an executive order pausing residential evictions and filings for 60 days. The order applies to the following agencies:
- Atlanta Housing Authority
- Atlanta Beltline Inc.
- Fulton County / City of Atlanta Land Bank Authority
- Invest Atlanta
- Partners for Home
- City of Atlanta’s Department of Grants and Community Development
The silver lining is that Georgia’s Chief Justice declared a Statewide Judicial Emergency, suspending all but “essential functions” of the courts until April 13th. A private landlord could file an eviction notice, but the majority of courts are not hearing eviction proceedings as part of the suspension. (A county court could deem eviction hearings as “essential”.)
The recently signed CARES Act provides a rebate for individual (non-businesses) taxpayers.
Individuals with adjusted gross income up to $75,000 may receive $1,200 or $2,400 for married couples filing joint returns with adjusted gross income up to $150,000. An additional rebate of $500 per qualifying child is available.
Independent tax policy nonprofit Tax Foundation offers a CARES Act Rebate Calculator to determine the amount of your economic impact payment.
The Treasury Department and the IRS announced that economic impact payment will begin to be distributed around the 3rd week of April. Amid much confusion and controversy, Treasury Department Secretary Steven T. Mnuchin issued an additional statement to clarify that
“Social Security recipients who are not typically required to file a tax return do not need to take an action, and will receive their payment directly to their bank account.”
The economic impact payment is currently slated to be a one-time occurrence.
Contact an Experienced Bankruptcy Attorney
If are facing a potential foreclosure or eviction or financial hardships, contact an experienced bankruptcy attorney. Filing bankruptcy may allow you to avoid foreclosure while starting fresh.
In order to slow the spread of COVID-19, Cherney Law Firm is currently offering free video-chat consultations.
Please contact us at 770.485.4141 to set up your appointment with Mr. Cherney.