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8M Households on the Brink of Eviction as Moratorium Ends June 30th

Moratorium on Evictions
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EDITOR NOTE: On Wall Street, a tsunami of excess cash has just been parked at the Fed’s reverse repo facility, threatening to push interest below zero--overall, an omen that the Fed’s easy money policy has come to an end and that it’s time for the market’s inflated values to come crashing down. On the lower end of Main Street, another tsunami appears on the horizon, as 8 million households (2.1 million of them being actual homeowners) being on the brink of eviction, foreclosure, or bankruptcy later this month as the government’s eviction and foreclosure moratorium end on June 30. Extending it may have negative consequences for the overall economy, potentially threatening the current recovery. Not extending it will likely trigger its own crash among the lower-income segments of American society, eventually finding its way to Main Street, and joining the chorus of horrors on Wall Street as assets begin to crash. Given the Fed’s miscalculations in just about everything they’ve done, there will be no “soft landing” in any scenario that one can imagine in the current economy. All are headed south. And those who are best positioned to survive or even thrive from this event will be the ones who’ve diversified a healthy portion of their portfolio to safe-haven assets, namely physical non-CUSIP gold and silver.

Even as the nation rebounds from the coronavirus pandemic, more than 2 million homeowners are behind on their mortgages and risk being forced out of their homes in a matter of weeks, a new Harvard University housing report warns.

Most of the homeowners at risk of foreclosure are either low-income or families of color, said researchers who published the 2021 State of the Nation's Housing report. Congress has dedicated $10 billion to help homeowners get caught up on payments, but it's unclear if that funding will make it to families before mortgage companies begin sending out foreclosure notices, researchers say.

Separately, millions more renters are "on the brink of eviction," the Harvard researchers found. Census data show that 6 million households are still behind on rent and could face eviction at the end of June, when federal eviction protections expire. 

The Center for Disease Control order halting some evictions, and federal liminations on foreclosures for federally-backed housing, both expire on June 30. Housing advocates have pushed for the Biden administration to extend both, but there is no indication an extension will happen.

"With so many renters in financial distress, there are concerns about an impending wave of evictions," the Harvard report said.

More than 7 million homeowners took advantage of the foreclosure moratorium passed as part of the Coronavirus Aid, Relief and Economic Security Act last spring. The provision was later extended by the Biden White House. As of March 2021, most of those homeowners have started repaying lenders and some are even up to date with their lenders. But that leaves about 2.1 million still behind on their mortgages, researchers said.

Originally posted on CBS News

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