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12.3.3.6 CARES Act Foreclosure Moratorium

Significant Law Change

In addition to the forbearance provisions, the CARES Act imposed a sixty-day moratorium on foreclosure activity. The moratorium applied only to federally-backed loans, but it was not limited to borrowers who could establish COVID-19 related hardships. The ban on activity was broad—it stated that lenders “may not initiate any judicial or non-judicial foreclosure process, move for a foreclosure judgment or order of sale, or execute a foreclosure-related eviction or foreclosure sale.”47 The CARES Act moratorium expired on May 17, 2020 without extension.

All of the federal agencies that insure, guarantee, or own the “federally-backed” loans covered by the CARES Act have subsequently issued their own foreclosure moratoria. These moratoria generally borrowed the broad language, but advocates should review the moratoria that applies to each loan type.

Footnotes

  • 47 CARES Act § 4022(c)(2).