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Apr 30, 2020 | Real Estate Law

Evictions and Foreclosures During the COVID-19 State of Emergency


On April 20th, Governor Baker took an important step preventing homeowners and renters from being forced out of their homes by signing into law a bill that prevents foreclosures and evictions from moving forward in Massachusetts during the COVID-19 state of emergency.  The moratorium will last for 120 days, or 45 days after the Governor lifts the state of emergency. 

During the state of emergency, residential landlords cannot terminate a tenancy or send any notice, including Notices to Quit, which request a tenant vacate a premise. The Act applies only to “Non-Essential Evictions”. 

The Act defines a “Non-Essential Eviction”, as “an eviction: (i) for non-payment of rent; (ii) resulting from a foreclosure; (iii) for no fault or no cause; or (iv) for cause that does not involve or include allegations of: (a) criminal activity that may impact the health or safety of other residents, health care workers, emergency personnel, persons lawfully on the subject property or the general public; or (b) lease violations that may impact the health or safety of other residents, health care workers, emergency personnel, persons lawfully on the subject property or the general public; provided, however, that a non-essential eviction shall not include an eviction for a small business premises unit on account of the expiration of the term of a lease or tenancy or a default by the tenant of a small business premises unit under the terms of its lease or tenancy that occurred before the declaration of the COVID-19 emergency.”

Landlords will likely oppose the temporary ban on issuing Notices to Quit, which are the first step in notifying tenants of a potential summary process eviction.  Tenant advocates will argue that such notices could pressure renters to leave, potentially endangering them and others in the middle of a pandemic.

After sending notice to tenants, landlords may access and utilize funds held as last month rent payments for certain expenses such as mortgage payments, utilities, repairs and required upkeep.  The funds cannot be used toward the non-payment of rent.  In order to access and utilize the funds, landlords must notify their tenants that the funds will be utilized before the last month of the tenancy, that the landlord remains obligated to apply the rent in advance as intended, and that the tenant is entitled to applicable statutory interest on such amounts as if unused. 

Residential and small business tenants receive further protections as courts have tolled all deadlines, may not issue judgments or executions, and may not schedule summary process eviction hearings.  In addition, landlords are prohibited from charging late fees in nonpayment of rent cases if tenants provide documentation, within 30 days of the missed payment, that the failure to pay was due to the financial impact of COVID-19. 

Mortgage lenders upon 1-4 family owner occupied residences which are not vacant or abandoned may not publish a notice of foreclosure sale, may not exercise a power of sale or right of entry, may not initiate a foreclosure process, and may not file a complaint to determine military status of a mortgagor. 

Lenders will be obligated to grant forbearance of up to 180 days to a borrower of a mortgage loan upon a residential property where the borrower has experienced a financial impact from COVID-19.  During the forbearance, no penalties or interest will accrue.  Any payment subject to the forbearance will be added to the end of the term of the loan unless otherwise agreed to by the parties.  The lender will be prohibited from furnishing negative mortgage payment information to a consumer reporting agency related to mortgage payments subject to forbearance under the Act.

It should be noted that nothing in the Act forgives rent or mortgage obligations. All amounts remain due and payable, subject only to the tolling/forbearance provisions of the Act or separate agreement of the parties.

Click here for the full Act: https://www.riw.com/wp-content/uploads/2015/08/H4647.pdf

The real estate department at Wilchins, Cosentino & Novins, LLP will be available to assist with all essential real estate related matters throughout the coronavirus pandemic and can be reached at all times. Please call Scott A. Joseph at 781-235-5500.

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