Good afternoon —
On Wednesday I wrote about the CDC's ban on evictions and asked for your feedback. Most of the responses said that this latest move by the CDC was unconstitutional, unfair to landlords or unlikely to help renters.
A chief lending officer of a Florida credit union wrote: "Sure seems like property rights and contracts have lost their hold on our way of life if the CDC can govern over them…I appreciate the CDC's motivation; however, they lack the authority to void contracts and property rights."
I had a lot of questions about the eviction ban and turned to Troy Freedman, managing foreclosure attorney at Richard M. Squire & Associates outside of Philadelphia, to get some answers.
One of the first things I wanted to know was whether the eviction ban has any teeth. Penalties for breaking the ban go as high as $250,000 and a year in jail for individuals, and up to $500,000 for a company, if an eviction led to the death of a tenant.
"I have concerns whether that was an inappropriate scare tactic by the CDC," Freedman said. In any case, proving that an eviction caused a person's death might be hard to do, Freedman said, since there are so many variables involved in a person's health that might not have anything to do with where they live.
Another question: Who will enforce the ban? It's not clear, although since it's a federal order, Freedman said the U.S. Attorney's office could have jurisdiction. Whether they would decide to enforce the eviction ban is still an open question.
And of course the whole issue might be moot if the ban is found unconstitutional, which is likely given the Supreme Court's decision in June on the CDC's previous eviction moratorium. On Wednesday night, landlord groups filed a petition in federal court asking it to immediately lift the new ban. President Biden himself acknowledged that only Congress could actually issue an eviction moratorium — just days before announcing the CDC's newest eviction ban.
"I have real problems with the CDC telling the Supreme Court 'We don't care what you said, we're going to do it anyway," Freedman said. "It suggests to people that they can go ahead and violate court orders — it's almost an anarchist act by the CDC."
The CDC has to file their response to the petition today, but Freedman predicts that whether they answer or not, "I believe this moratorium is going to be short-lived."
Unfortunately, in the meantime there are real consequences for landlords, some of whom are facing foreclosure on their properties, Freedman said. The government has provided help to landlords through the American Rescue Act, but not all landlords are aware of that help. In addition, Freedman said some state financial agencies were requiring landlords to go to their servicers and seek loan mods before they can access that help. If that request is denied, that could cost landlords months of time before they can pay their mortgage.
It's a messy situation all around.
John M from Chicago summed it up in his note to me: "As a landlord, I'm devastated by this decision…We all wanted to help when this first started, it was tough, but morally right to help. But now the only thing we're doing is subsidizing the government's plan."
Until Monday —
Sarah Wheeler
HousingWire Editor in Chief
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