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A Federal Eviction Moratorium Ends This Week, Putting 12 Million Tenants at Risk

Submitted by ckanon@abi.org on
A federal moratorium that has protected millions of renters from eviction since late March expires Friday, leaving millions of people at risk even as the coronavirus continues to spread across the nation, The Washington Post reported. The moratorium covers renters who live in homes with federally backed mortgages, which the Urban Institute estimates to be 12.3 million households, or about 30% of all renters nationwide. Once the moratorium lapses, landlords can give their delinquent tenants 30 days notice, then begin filing eviction paperwork in late August. The expiration of the federal protection comes as state and local eviction bans are also starting to expire and enhanced federal unemployment benefits that kept many renters afloat are scheduled to end. This will put more pressure on renters already scraping by, housing advocates say. “We are looking at an eviction cliff, and once we fall over it, it will be hard to climb back,” said David Dworkin, president of the National Housing Conference. With expectations growing that the recession triggered by the pandemic could be deeper and longer than many economists expected, housing advocates are pressing Congress to step in to prevent a significant rise in evictions this year. The House passed legislation to create a $100 billion rental assistance fund. Last week, Sen. Kamala D. Harris (D-Calif.) unveiled a sweeping housing plan that would ban evictions and foreclosures for a year while giving tenants up to 18 months to pay back missed payments. The emergency rental assistance program passed by the House would help renters at the lowest income levels for up to two years, said Diane Yentel, president and chief executive of the National Low Income Housing Coalition. The money could be delivered through state housing finance agencies, public housing agencies or other nonprofits, she said. “States and localities are pretty adept at setting up emergency rental assistance programs,” Yentel said.
Article Tags
Consumer Debt
Covid19
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Study: Coronavirus Led 33% of Americans to Make a Credit-Harming Decision

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As the coronavirus persists in the U.S., one-third of Americans have admitted to making at least one financial decision in the last four months of the pandemic that is likely to hurt their credit score, a new Bankrate study has revealed and Fox News Business reported. Particularly, the main financial decisions Americans have made that can adversely affect their credit score include adding more debt, paying at least one bill late, carrying a balance, ignoring a bill payment date or canceling a credit card. Of those who increased their debt, 22% of respondents said that their household income was negatively impacted by the pandemic, while 11% said their household income was not negatively impacted. Meanwhile, for the people who reported paying a bill late, only 18% had their household income negatively impacted while seven percent did not. When it comes down to the people who kept a balance on their credit card, 44% incorrectly believe that carrying balance would increase their credit score. This finding may suggest that around two in five cardholders may not be aware that credit utilization can make up 30% of a person’s credit score, according to Experian. Although one survey showed that some Americans have dabbled in financial behaviors that aren’t the best for a healthy credit score, only 13% of cardholders said they are concerned about shrinking credit reports. However, households with challenged finances are reportedly more than three times as likely to have money concerns versus their financially stable counterparts at 20% versus 6%, respectively.
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Consumer Debt
Covid19
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United Airlines Posts $1.6 Billion Loss in Virus-Scarred 2Q

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United Airlines said that it lost $1.63 billion in the second quarter as revenue plunged 87%, and it will operate at barely over one-third of capacity through September as the coronavirus throttles air travel, the Associated Press reported. The Chicago-based airline burned through $40 million a day from April through June but said it will trim losses to $25 million a day in the third quarter by slashing costs. CEO Scott Kirby said that United cut its cash-burn rate below its closest rivals by shrinking its schedule to meet lower demand and cutting costs across the company. In a statement, he said that the moves “positioned United to both survive the COVID crisis and capitalize on consumer demand when it sustainably returns.” Investors will have to wait for United to provide more details about the quarter and the future outlook on Wednesday, when executives hold a call with analysts and reporters. United, which started the year with 96,000 employees, said 6,000 have volunteered to take severance packages and leave. Last week, the airline warned 36,000 employees that they could be furloughed in October, although executives said they expect the final job-loss number to be smaller. The quarterly loss, which was worse than Wall Street expected, followed the plunge in air travel due to widespread travel restrictions and passengers’ fear of flying during the coronavirus pandemic.
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Airlines
Covid19
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Nostalgic for 2019: Three in Four Americans Worry Life Will Never Go Back to “Normal”

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Remember the good old days, way back in 2019? It’s an odd feeling to be nostalgic for a time that just passed, but according to a new survey of 2,000 Americans, many are worried the world will never return to its simpler, pre-coronavirus state, Study Finds reported. All in all, 75% of those surveyed said they fear life will never return to what was once “normal.” The survey, commissioned by Torch, asks respondents how they envision the world will appear in the wake of COVID-19. One overarching theme that participants echo is just how different the workplace, and employment in general, will be. As of now, 59% of surveyed Americans admit that they would be far too afraid to start reporting to a shared workplace once again. Meanwhile, 36% have concerns they’ll <em>never</em> be able to get back to the office without potentially putting themselves and their family in harm’s way. In broader terms, 63% of participants flat out say that their job will never be the same. That same group is anticipating working remotely for at least the rest of 2020.
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Consumer Debt
Family/Divorce Issues
Covid19
Labor/Employment
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Months After Filing, Thousands of Americans Are Still Waiting for Their Tax Refunds

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American taxpayers got an extra three months from the Internal Revenue Service (IRS) to pay their taxes this year, but this act of bureaucratic largesse didn’t benefit many people who filed their returns long before the usual April 15 deadline. They are still awaiting refunds, The Washington Post reported. For the most part, the IRS stopped processing paper returns around March 30 because of the novel coronavirus. Some work was curtailed even earlier. “Yes, some paper returns filed early in the season have not yet been processed,” IRS spokesman Eric Smith said. “We have been hearing this from a number of folks and very much understand that people are concerned. We are continuing to whittle away at our paper inventory.” The coronavirus-related chaos that has marred this year’s tax season should give people who still mail paper tax returns additional incentive to switch to electronic filing. The agency began a phased reopening on June 1, with employees working to dig out from under a backlog of mail. “Even now, we’re still not at 100% staffing,” Smith said. As of the week ending July 4, the agency estimates that it had 7.8 million pieces of mail correspondence, which includes about 3.6 million unopened returns, Smith said. “These are not exact figures, and because both paper and electronic returns continue to come in, it’s very much a moving target,” he said. “So, we don’t yet have an estimated date of when the backlog will be completed.”
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Consumer Debt
Covid19
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A Glimpse Into the Fiscal Gloom Bearing Down on America’s Cities

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Discussion over what to do about America’s depleted cities reaches a climax of sorts this week as congressional leaders say they’ll hammer out an aid package, Bloomberg reported. In May, a $3.5 trillion round of stimulus that includes roughly $1 trillion for state and local governments passed the U.S. House, only to stall in the Republican-controlled Senate. Already this year, Congress has approved $150 billion in aid for state and local governments, but the money comes with a condition: It can’t be used to replace lost revenue. In a presidential election year, Ohio’s pleas for help stand out. Polls in the state, with its 18 electoral votes, show a dead heat between President Donald Trump and Democratic challenger Joe Biden after Trump won the state by 8 percentage points in 2016. Failing to provide more aid, or not enough, leaves the U.S. at risk of repeating a key mistake of the last recession, said Nick Johnson, a senior vice president at the Center on Budget and Policy Priorities. Federal stimulus prevents job and service cuts at the local level, which can stifle recovery and snowball into lower revenues and more cuts. States are hurting, too.
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Covid19
Municipal Bankruptcy
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A Bank Paid People to Bring in Coins to Help Small Businesses During the Nationwide Coin Shortage

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Community State Bank in Wisconsin recently launched a new incentive to help fight the coin shortage that's made its way across the U.S., Business Insider reported. The bank launched a “Coin Buy Back Program” offering a $5 bonus for every $100 worth of coins turned into any of its seven locations. Patrons and non-bank customers were eligible to participate in the program for up to a max coin bonus of $500. A week after debuting the program, the bank hit its goal and announced the incentives would expire at the end of the July 21 business day. “We knew we needed to figure something out. We hate the idea of telling our customers, ‘No, we can't give you one of the services we're proud to provide,’ so we came up with a creative way to get things done,” Community State Bank Vice President Neil Buchanan said. “Just because this hasn't been done before doesn't mean it isn't going to work — and it has already made a huge difference.” The move is the latest example of local businesses and small banks across the nation seeking to combat the coin shortage in the midst of the coronavirus pandemic. Another bank in Wisconsin, Bank of Sun Prairie, recently asked its customers to deposit coins, though it did not offer a bonus. Community State Bank said it had seen strong participation and called the turnout a success. None of the major U.S. banks have announced plans to pay customers a bonus to bring in coins, but Wells Fargo said that it was “actively managing our coin inventory and working with customers to meet their coin needs to the extent possible after the Federal Reserve put limitations on coin deliveries to all financial institutions nationwide.” The coronavirus has taken a toll on coin circulation, according to the Federal Reserve. Lately, the reduced pace of circulation has led to inadequate quantities of coins.
Article Tags
Covid19
Finance and Banking
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Amid a Deadly Virus and Crippled Economy, One Form of Aid Has Proved Reliable: Food Stamps

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More than 6 million people enrolled in food stamps in the first three months of the coronavirus pandemic, an unprecedented expansion that is likely to continue as more jobless people deplete their savings and billions in unemployment aid expires this month, the New York Times reported. From February to May, the program grew by 17%, about three times faster than in any previous three months, according to state data. Its rapid expansion is a testament to both the hardship imposed by the pandemic and the importance of a program that until recently drew conservative attack. The rolls have surged across Appalachian hamlets, urban cores like Miami and Detroit, and white-picket-fence suburbs outside Atlanta and Houston, rising faster in rich counties than in poor ones, as the downturn caused by the virus claimed the restaurant, cleaning and gig economy jobs that support the affluent. Food stamps — formally known as the Supplemental Nutrition Assistance Program (SNAP) — support young and old, healthy and disabled, the working and the unemployed, making it the closest thing the U.S. has to a guaranteed income. Though administered by states, the benefits are paid by the federal government, with no spending cap, and the program has largely avoided the delays that have plagued unemployment insurance. After long pushing to reduce SNAP usage, claiming it promotes dependency and waste, the Trump administration eased administrative rules during the pandemic to speed enrollment. Florida and Georgia have expanded caseloads the most, and state officials from both parties have called the program an essential anti-poverty tool.
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Consumer Debt
Covid19
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Head of the Line: Big Companies Got Coronavirus Loans First

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Ever since the U.S. government launched its emergency lending program for small businesses on April 3, there have been complaints that bigger companies had their loans approved and disbursed more quickly, and there is now evidence to back up those complaints, the Associated Press reported. Its analysis of the Small Business Administration’s (SBA) $659 billion Paycheck Protection Program shows that nearly a third of the loans approved in the program’s first week ranged from $150,000 to $10 million, the maximum allowed. In a second round of funding that began April 27, such loans made up just 7.4% of the total. The average loan size fell from $257,240 on April 10 to nearly $105,000 as of July 17, according to the SBA. The PPP made very low-interest loans available to any business — or any franchisee of a business — with under 500 employees. Larger companies with connections to major national or regional banks got priority treatment in the program’s initial phase, while many smaller businesses said they were turned away because the banks required them to have a checking account, a credit card and a previous loan to be considered. Some small businesses submitted an application but then heard nothing. Many learned not from their bank but via news reports that the initial $349 billion in funding had run out in less than two weeks.
Article Tags
Business Reorganization
Covid19
Small Business
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EU Agrees on a Historic, Unprecedented $860 Billion Recovery Fund as the Bloc Fights the Fallout of Coronavirus

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EU leaders have agreed on a landmark 750 billion euro ($860 billion) recovery fund for the reconstruction of the region disrupted by the coronavirus pandemic, Business Insider reported. The agreement was made public after European council president, Charles Michel, tweeted "Deal!" early Tuesday. "These were, of course, difficult negotiations in very difficult times for all Europeans," he said in a statement. After heated debate and difference of opinion on the specifics of grants and loans since last Friday, the heads of states reached common ground on an outline of how to invest the new funds at their first in-person summit in five months. The leaders finally agreed on distributing 390 billion euros ($446 billion) in non-repayable grants, down from an originally proposed 500 billion euros ($641 billon), which was opposed by the Netherlands, Austria, Sweden and Denmark. The 27-member bloc accepted low-interest loans worth 360 billion euros ($412 billion).
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Covid19
International Insolvency
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