With the COVID-19 pandemic, we all cared about the rising number of positive cases, the death toll, and unemployment. But one more factor needs attention, i.e., the housing problem. So far, we have seen the articles telling information about the Employee Retention Credit benefits regarding unemployment. But to the surprise, it covers a broader audience, ranging from small business owners to property owners.
The authorities did this because, along with the business owners, the property owners and renters also faced hardships. Some surveys estimated that around 30 to 35 million people were at the menace of eviction. Just like ERC benefits small businesses, the Federal Government passed the CARES Act to provide aid to the property owners.
From both a property owner’s and tenant’s perspective, how does the Cares Act affect them? Discover how the pandemic has affected property owners in the following paragraphs.
What Is CARES Act?
The Coraniavirus Aid, Relief, and Economic Security Act is known as CARES Act. It was initially the legislation that got passed into law on 27 March 2020. CARES Act relief package has a worth of around $2 Trillion. It was aimed to provide financial assistance and protection to businesses, Americans, property owners, and workers. Basically, its objective was to stop or atleast slow down the impact of pandemics on all sectors of the US economy. This act provided the following benefits:
- Expansion of unemployment benefits
- Assisted small businesses through grant programs and $367 billion loans
- Paid directly to families, $500 per child and $1200 per adult
- Assisted corporations by assigning $500 billion funds for loans
- Provided airlines with $25 billion
- Granted $150 billion to state and local governments
- And $130 billion to healthcare systems, hospitals, and healthcare providers
This act always protected homeowners and property owners by mortgage forbearance. In addition, it put an end to evictions. There were no late fees, penalties, or other charges that landlords could charge tenants for paying rent late.
How Does the Cares Act Affect Property Owners?
The CARES Act was designed to help property owners, so let’s examine some of its features.
Endurance of Mortgage Payments
Property owners with Freddie Mac loans or Fannie Mae can request mortgage endurance. There were two additional 30 days allowed after the first 30 days of forbearance. However, tolerance was subject to certain restrictions if you rented the property.
Those who could not pay the rent of the properties were prevented from evicting them. Further, this act restricted property owners from charging any penalties or fees for late rent payments. Besides, this act didn’t permit the property owners to issue a notice asking their renters to vacate.
Ensures That Credit Reports Are Accurate
Property owners must also report certain information to the credit bureaus. During the 120-day window, property owners could not report nonpayment or late payment when they made accommodations for rent. Renters already delinquent in their payments before the CARES Act were exempt.
Renters were provided with housing assistance under the CARES Act. Property owners were prevented from pursuing eviction several times as a result of the eviction moratorium being extended. However, on 26 August 2021, it finally expired. These moratoriums are now set to expire, leaving many renters uncertain about their futures.
As you saw, how with the help of the CARES Act, property owners, and renters passed the coronavirus pandemic. However, they shall move forward now as the aid expires. Along with the CARES act, the government also assisted small business owners through Employee Retention Credit and PPP. So, do you want to know whether your business benefit from such aid? Contact the best ERC Specialists by visiting the Claim Credit .They can provide you with the help you need.