FHFA has announced that Freddie Mac and Fannie Mae will offer qualifying multifamily property owners forbearance through June 30, 2021.
By Kelsi Maree Borland | March 08, 2021 at 06:41 AM | Originally posted on Globest.com
The Federal Housing Finance Agency has announced that Freddie Mac and Fannie Mae will extend multifamily forbearance for COVID-19. Qualifying multifamily property owners will be eligible for forbearance through June 30, 2021. The program was scheduled to expire on May 31, 2021.
The extended forbearance policy will include the same tenant protections as required previously: Multifamily owners must inform tenants in writing about tenant protections available during the property owner’s forbearance and repayment period, and they must agree not to evict tenants due to nonpayment of rent while the property is in forbearance. In addition, once the forbearance period expires, multifamily owners must give tenants at least a 30-day notice to vacate; cannot charge late fees or penalties for nonpayment of rent; and must allow flexibility in the repayment of back rent, which will not necessarily be in a lump sum.
The forbearance policy is intended to aid both property owners and tenants that have been impacted by the pandemic. To qualify, multifamily owners must show that they have incurred a financial hardship due to the COVID-19 emergency. Fannie and Freddie have extended the program as it is clear that COVID-19 continues to impact both apartment operators and tenants.
FHFA has pushed to extend unemployment benefits several times since the onset of the pandemic last March. At the end of 2020, FHFA extended the deadline to March 31 from an end-of-the year extension. The same policy remained in place as noted above. Multifamily owners were required to demonstrate a hardship related to the pandemic and implement the tenant protections related to eviction, repayment and transparency.
Although the pandemic is continuing to impact the multifamily market, rent collections increased in December with nearly 90% of tenants making a full or partial payment. However, rent payments were down 3.4% from the same time in 2019. December rent payments also fell from the previous month, down to 89.9% in total collections from 90.3% in November.
In January, the numbers fell again. The NMHC found that 79.2% of respondents in its survey of 11.6 million units made a full or partial rent payment by February 6, 2021. In comparison, 76.6% made a full or partial rent payment by January 6, 2021.
To view our current multifamily properties for sale, visit our Properties page.