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Weekly update from the National Housing Conference
In this issue
April 26, 2020 I Issue 89-16

  • FHFA addresses mortgage liquidity concerns
  • Congress passes interim Coronavirus aid package
  • Lawmakers call for action to protect nursing home residents
  • Omar introduces bill to cancel rent and mortgage payments
  • Florida Sun-Sentinel publishes consumer guide on mortgage forbearance
  • Chart of the Week: Urban Institute monthly chartbook shows COVID-19’s impact on mortgage market
Find the information you need at NHC's COVID-19 Housing Resource Center
Preparing now for what comes next


Dear Friend,

The economic crisis caused by the COVID-19 pandemic reached a new level this week as an additional 4.4 million Americans filed for unemployment insurance, driving the number of people who have lost their jobs to at least 26 million and the unemployment rate to an estimated 18%. Numerous states are struggling to process new applications and the actual numbers could be higher. Six weeks in, we have a long road ahead of us. 

Yet, after an initial and relatively bold response, policymakers in Washington have pushed their heads deep into the sand, hoping against hope, that it will all get magically better. The Federal Housing Finance Agency provided much-needed clarity for mortgage servicers but has refused to provide the liquidity support necessary to help them get through the duration of the crisis. They should be encouraging mortgage servicers to give troubled borrowers the help they need now, but instead, they have forced them to kick the can down the road, doubling or tripling the amount of work necessary to provide lasting help to those who need it. 

Likewise, the Treasury Department threw cold water on suggestions by the Federal Reserve Board that they might work together on creating a liquidity facility to support the mortgage market. Congress, in the meantime, has failed to pass comprehensive rental assistance, waiting for the crisis to escalate beyond the government’s ability to cope. Refusing to plan for the next phase of a crisis that is already upon us is a recipe for disaster. But it doesn’t have to be this way.

That’s why NHC is working with a wide range of housing leaders to help develop a comprehensive approach to rental assistance that will provide real help to both renters who lose their jobs and are not fully covered by unemployment insurance, as well as the apartment owners who still have to pay to keep buildings clean and operational. We don’t want people evicted at the end of the crisis because they followed social distancing guidelines or lost their jobs when their companies laid them off or went out of business.

News from Washington I By Quinn Mulholland
FHFA partially addresses mortgage liquidity concerns

After weeks of increasingly urgent calls from mortgage industry groups for help with liquidity issues, FHFA announced on Tuesday that it would implement a four-month cap on the period of time mortgage companies are required to advance missed payments from borrowers. The cap, which applies to single-family loans backed by Fannie Mae and Freddie Mac, comes as the share of mortgage loans in forbearance jumped to almost 6%, according to the most recent MBA survey. MBA President and CEO Robert Broeksmit praised the FHFA’s announcement in a statement , saying, “This is an important step in reducing the maximum liquidity demands for servicers who are providing mortgage payment forbearance for borrowers who have a pandemic-related hardship, and we appreciate FHFA's action.” FHFA also announced last week that the GSEs will purchase single-family mortgages in forbearance in another effort to support mortgage lenders during the crisis. “We are focused on keeping the mortgage market working for current and future homeowners during these challenging times," said FHFA Director Mark Calabria in a statement.
Lawmakers call for action to protect nursing home residents

In the wake of several news reports showing high levels of COVID-19 infections and deaths in nursing homes, congressional leaders called for action to protect residents of these facilities. House Ways and Means Chairman Richard Neal (D-Mass.) urged Centers for Medicare and Medicaid Services Administrator Seema Verma to assist these facilities in protecting their residents in a statement on April 17. Senate Finance Committee Chairman Chuck Grassley (R-Iowa) also sought more information on the Trump administration’s response to the outbreak in nursing homes in a letter to Verma and Department of Health and Human Services Secretary Alex Azar. Two Democratic members of the Committee, Bob Casey (D-Penn.) and Ranking Member Ron Wyden (D-Ore.), issued a statement condemning the administration for not providing more information to the public about the spread of COVID-19 in nursing homes. In response to these calls, the Centers for Medicare and Medicaid Services announced new regulatory requirements on April 19 that will require nursing homes to inform residents, their families and representatives of COVID-19 cases in their facilities.
Omar introduces bill to cancel rent and mortgage payments

Rep. Ilhan Omar (D-Minn.) recently introduced legislation that would forgive rent and mortgage payments for during the COVID-19 pandemic. The bill would also ensure credit ratings would not be negatively affected during the length of the crisis. The proposed legislation also includes a relief fund for landlords and mortgage servicers to cover resulting income losses. “We must take major action to protect the health and economic security of the most vulnerable, including the millions of Americans currently at risk of housing instability and homelessness,” Rep. Omar said in a statement. The bill is co-sponsored by Reps. Alexandria Ocasio-Cortez (D-N.Y.), Rashida Tlaib (D-Mich.), Pramila Jayapal (D-Wash.), Mark Pocan (D-Wisc.), Ayanna Pressley (D-Mass.), Veronica Escobar (D-Tex.), Jesús “Chuy” García (D-Ill.) and Grace Meng (D-N.Y.). According to the most recent National Multifamily Housing Council Rent Payment Tracker , 89 percent of renters made a full or partial rent payment by April 19, compared to 93 percent at the same time last year.
Congress passes interim Coronavirus aid package

President Trump signed into law a $484 billion legislative package on Friday that included new emergency aid for small businesses and hospitals after congressional negotiators reached a deal and passed the bill earlier in the week. The bill includes $321 billion to replenish the depleted Paycheck Protection Program, which ran out of money on April 16 after approving over 1.6 million loan applications totaling more than $339 billion. The bill was described by legislators as an interim measure, with Senate Appropriations Committee Ranking Member Patrick Leahy (D-Vt.) saying in a statement , “We cannot be led to believe that our work here is done.” Lawmakers continue to lay the groundwork for a more comprehensive aid package, which may include housing measures. A bipartisan group of senators called for rural housing assistance to be included in a future relief package in a letter to the chairman and ranking member of the Senate Appropriations Committee. In a Medium post , Sens. Elizabeth Warren (D-Mass.) and Sherrod Brown (D-Ohio) argued for the inclusion of measures to help consumers, including support for renters and homeowners struggling to make rent and mortgage payments. Sens. Brown and Warren, along with several other Senate Democrats, also sent a letter to a group of major mortgage servicers calling on them to notify eligible homeowners of the forbearance options available to them under the CARES Act.
Florida Sun-Sentinel publishes consumer guide on mortgage forbearance

The Florida Sun-Sentinel published a major consumer guide on home mortgage forbearance, which noted that most out-of-work homeowners frightened by the thought of suspending their mortgage payments will get the help they need – eventually. “But that's not what many are being told when they reach out to hit the pause button on their monthly payments," the article observed. "Many, if not most, loan service companies are telling borrowers they can stop making payments for only up to three months and will have to repay it in a lump sum on the fourth month. That’s not accurate. Borrowers have many repayment options, but their mortgage servicers aren’t being allowed to offer them up front.” The article noted that the Federal Housing Finance Agency was largely responsible for the confusion, demanding that borrowers be told they have to pay all the missed payments in 3-6 months, although most will be allowed to defer their payments to the end of their loan term. NHC CEO David Dworkin cautioned that “rather than this waterfall of options, we need a clear, concise national approach to mortgage forbearance. Otherwise, it will continue to be confusing to borrowers and more labor intensive for servicers.”
Chart of the Week
Urban Institute monthly chartbook shows COVID-19’s impact on mortgage market

According to the Urban Institute’s April 2020 Housing Finance Policy Center At A Glance guide , the COVID-19 pandemic has already “dramatically altered the course of broad mortgage market metrics.” One aspect of the mortgage market in which this is most apparent is the plunge in purchase mortgage applications, which have fallen 36 percent since February.
What we're reading
In an op-ed for National Mortgage News , NeighborWorks America President and CEO Marietta Rodriguez argued that the Trump administration’s current efforts to modernize the Community Reinvestment Act (CRA) are misguided. “Now, as the nation struggles with pandemic response and hopes for stabilization and recovery,” Rodriguez wrote, “is not the time to make major changes in any regulation, let alone the CRA.” Read the op-ed here .

In an article published Monday, the Phoenix New Times highlighted the story of an apartment complex that stopped accepting Section 8 vouchers after being bought by a private equity firm. Residents of the complex, according to the article, are now scrambling to find a new place to use their vouchers. Read the article here .

The Guardian examined the impact of climate change on waterfront living in a recent article. The article focused on Boston, which is experiencing a surge in waterfront development with innovative seawall defenses, although this may not be a model for all cities. Read the article here .
The week ahead
Monday, April 27

Tuesday, April 28

Wednesday, April 29

Thursday, April 30

Friday, May 1
The National Housing Conference has been defending the American Home since 1931. We believe everyone in America should have equal opportunity to live in a quality, affordable home in a thriving community. NHC convenes and collaborates with our diverse membership and the broader housing and community development sectors to advance our policy, research and communications initiatives to effect positive change at the federal, state and local levels. Politically diverse and nonpartisan, NHC is a 501(c)3 nonprofit organization.
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