No More Than 10 Can Attend: Texas Executive Order Effectively Halts Public Foreclosure Sales

There is no question that the COVID-19 pandemic has prompted a swift and large-scale shift in the way real property transactions take place from “business as usual” to a state of limbo in most of the 50 states. In Texas, commercial real estate lenders and creditors have recently found themselves to be no exception when it comes to carrying out foreclosure sales. Executive Order GA-28 is changing, if not outright preventing, a valid foreclosure sale from taking place in Texas—at least for the time being.

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California Assembly Bill 828 Would Halt Residential Foreclosures During COVID-19 Emergency – But Is It Enforceable?

If passed, California Assembly Bill 828 would prevent action to foreclose on a residential real property while a state or locally declared state of emergency related to COVID-19 is in effect, and for 15 days after the state of emergency has ended.

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Mortgage and Other Real Property Relief Under the CARES Act

The Coronavirus Economic Stabilization Act (CESA, under Title IV of the CARES Act) puts in place a foreclosure moratorium for certain residential properties (including individual units of condominiums and cooperatives), and an eviction moratorium for tenants of certain “covered property” (predominantly multifamily housing units). The foreclosure moratorium applies to foreclosures of single family residential real property (designed for occupancy by one to four families) subject to federally backed mortgage loans (prohibiting loan servicers from initiating foreclosure actions). The eviction moratorium applies to lessor eviction actions based on nonpayment of rent or other fees and charges from single family and multifamily properties that (i) participate in certain federal housing voucher programs, (ii) have a loan that was made or guaranteed a federal program, or (iii) were purchased or securitized by Fannie Mae or Freddie Mac (collectively, “Covered Property”) (prohibiting lessors from intiating eviction actions). In addition to the imposition of the above noted moratoria, CESA has mandatory forbearance provisions that apply to loans on single and multifamily residential property with federally backed mortgages.

To read the full text of this Duane Morris Alert, please visit the firm website.