Massachusetts Eviction Moratorium Goes to Court

The Massachusetts eviction moratorium, which has been in place since March, is off to court. A group of Massachusetts landlords have brought a lawsuit challenging the legality of this order, and have asked for a preliminary injunction, requesting that the court immediately stop the eviction ban while the case proceeds.

It would take much longer than a blog post to discuss all of the legal arguments for and against the Massachusetts eviction moratorium, but here’s a quick summary of some of the major points:

  • Landlords argue that the moratorium interferes with the right to access the courts, and the separation of powers between the legislative and judicial branches
  • Landlords argue that the ban is a constitutional “taking” of property, where landlords are deprived of property without compensation
  • Landlords argue that the eviction moratorium interferes with private contracts (leases)

This court case, which was filed in Suffolk Superior Court, is being followed by another legal action in federal court, concerning federal constitutional issues.

Attorney Richard Vetstein and Attorney Jordana Greenman represent the landlords, and did an superb job representing their clients. I’m not familiar with the attorneys who represented the Commonwealth, but they did an excellent job as well.

Judge Paul Wilson is hearing this case, and will be issuing a decision soon. I’ve had the opportunity to argue before Judge Wilson, and can attest that he is a good judge who will issue a well-reasoned decision on these important issues of law. Stay tuned.

If you need assistance with a landlord-tenant matter, or have a question about the eviction moratorium, contact me for a consultation.

Evictions in Massachusetts on Hold Through October 2020

Evictions in Massachusetts are now on hold through October 2020, per Governor Baker’s extension of the eviction and foreclosure moratorium. The moratorium was set to expire on August 18th, and is now extended through October 17, 2020.

As I have written before, the eviction moratorium has put the brakes on nearly every eviction in Massachusetts. With the exception of emergency matters, no eviction cases may be filed until the end of the moratorium. Tenants still remain liable for rent, but without evictions, there is no immediate option for dealing with a non-paying tenant.

Without evictions in Massachusetts, what should landlords do?

  • For non-paying tenants, landlords should send monthly notices of owed rent. It is critical that such notices make it clear that no such eviction will occur during the moratorium.
  • Landlords can and should speak with tenants about problems that arise during the eviction moratorium, including unpaid rent. It may be possible to work the matter out with out court involvement, such as through a repayment plan.
  • Landlords should always keep good records of all landlord-tenant matters . . . especially now. If an eviction becomes necessary, such records are vital for a successful case.

I’ve heard from many landlords who are struggling during the eviction moratorium, and who are understandably concerned about the future. While the moratorium remains in place, it will pass . . . just like the COVID-19 pandemic.

In the meantime, if a landlord has a situation that they believe is a true emergency, they should speak to an experienced attorney. Even with the moratorium in place, I’ve been able to help landlords with some difficult tenant cases, and would be happy to speak with you about your matter. Contact me for a consultation.

Notices to Quit for Non-Payment of Rent: Proceed with “Care”

Notices to quit for non-payment of rent are required for initiating an eviction against a delinquent tenant. A landlord must generally provide a fourteen-day notice to quit for such an eviction.

However, the recent federal “Coronavirus Aid, Relief, and Economic Security Act” (CARES Act) throws a wrinkle into this process. As such, landlords need to proceed with “care” with serving a notice for non-payment of rent (pun intended!).

Overview of Massachusetts Evictions During Coronavirus

Both federal and state law are presently prohibiting most residential evictions in Massachusetts. The CARES Act placed an initial moratorium on a large majority of eviction cases. The subsequent state eviction moratorium has stopped all non-essential evictions across the state.

When the moratorium ends, it is expected that evictions will resume (albeit under different circumstances and conditions). However, a requirement of the CARES Act will remain after the moratorium ends for notices to quit for non-payment of rent.

Notices to Quit for Non-Payment of Rent: Additional Time Required in Certain Cases

While notices to quit for non-payment of rent generally require fourteen days, the CARES Act now requires that such notices, when sent after the end of the moratorium, provide the tenant with thirty days notice.

This only applies to a specific category of properties, referred to as a “covered dwelling unit” under the CARES Act. These are generally properties that participate in a federal program or have a federally backed mortgage.

While this category applies to a wide array of tenant properties, the following landlords, in my opinion, are the most common ones who will fall under this law: those who participate in the Section 8 housing program, and those with a Fannie Mae or Freddie Mac mortgage.

For such rental properties, a thirty day notice (and not fourteen) will be required.

Practical Implications

When the courts reopen, there will be a flood of non-payment eviction cases. I’m predicting that many tenants will raise defenses related to whether the landlord served them with the proper notice to quit.

With this in mind, landlords need to be extra careful when preparing a notice to quit. If there is any chance that their rental property is covered under the CARES Act, the landlord should go with a thirty-day notice for non-payment of rent evictions.

If you need assistance with a landlord-tenant matter, contact me for a consultation.

Foreclosure Moratorium in Massachusetts: FAQs

UPDATE: The eviction and foreclosure moratorium has been extended through October 2020.

Earlier this week,  Governor Baker signed into law “An Act providing for a moratorium on evictions and foreclosures during the COVID-19 Emergency.” I previously wrote about how this law affects evictions. In this post, I’ll discuss the foreclosure moratorium.

What Foreclosures Are Covered Under the Moratorium?

The moratorium covers all residential foreclosures in Massachusetts. This law broadly prohibits all action related to a Massachusetts foreclosure, including the start of a Servicemembers Case and the publishing of a foreclosure sale notice.

An exception is allowed for “vacant or abandoned” property. The law does not cover foreclosures for commercial property.

What Relief is Available to Homeowners Under the Moratorium?

The law allows a homeowner to request a forbearance of their mortgage loan, which temporarily suspends payments on the loan. This is only allowed for those who have a “certain mortgage loan”, which is defined under a pre-foreclosure law, G.L. c. 244, § 35B. This forbearance, importantly, requires that the unpaid loan expenses be added to the end of the loan.

Forbearances are presently allowed for many homeowners under the federal CARES Act. However, to the best of my knowledge, a forbearance under the CARES Act does not require a lender to add the unpaid balance at the end of the loan, as the state moratorium does.

How Long Will the Moratorium Last?

120 days after the passage of the bill or 45 days after the COVID-19 emergency declaration has been lifted . . . whichever is sooner. The Governor also has the power to extend this moratorium.

What Impact will the Moratorium Have on Future Foreclosures?

A common misconception about foreclosure is that the process begins immediately after a homeowner misses a loan payment. In Massachusetts, nothing can be further from the truth. A myriad number of state and federal laws and mortgage requirements must be followed before a foreclosure sale can occur. It can easily be at least a year (and often longer) from the default of a loan up to a foreclosure sale.

As such, even without the moratorium, I wouldn’t have expected too many foreclosure sales to occur during the coronavirus pandemic. Some lenders may have started the process, but few homes would have actually been foreclosed. This moratorium will delay the inevitable foreclosures that will eventually arise from the pandemic.

What will happen next? It is possible that a wave of foreclosures may occur in the next several years, similar to what happen after the 2007/2008 financial meltdown. In my opinion, the most likely scenario is that loan servicers and other mortgage holders will be flooded with requests for mortgage relief in the next year. Many homeowners, unfortunately, will have difficulty getting the assistance they need.

Final Thoughts

If you need assistance with a foreclosure matter, contact me for a consultation.