US to landlords, lenders: heed pro-military housing rules

The Department of Justice and the Consumer Financial Protection Bureau are warning mortgage servicers and landlords to heed rules meant to protect members of the U.S. military against foreclosure, eviction and other potential housing-related financial hardships during the pandemic.

The move, announced Monday, comes as forbearance programs put in place in the early weeks of the pandemic last year to allow homeowners to hit pause on their mortgage payments are set to expire at the end of the month.

The Department of Justice also said it has received complains from servicemembers and veterans who ran into problems after entering into a COVID-19 hardship mortgage forbearance program, including being reported as delinquent borrowers for not making timely payments and being required to make lump sum payments to reinstate their home loans. The complaints are being reviewed by the CFPB.

All told, roughly 7.6 million homeowners entered forbearance during the pandemic, according to the DOJ. A majority of borrowers have resumed making their mortgage payments, but roughly 1.25 million others, many military personnel or veterans, remain in forbearance programs about to expire, the government said.

Members of the military have legal protections established so they are free to comply with their service requirements, such as a potentially lengthy deployment overseas. Among the protections: mortgage servicers, which manage payment collection on home loans, are not allowed to foreclose on or evict certain servicemembers or their families without a court order.

The DOJ and the CFPB’s letter to landlords focused on reminding them of the legal protections that apply to military tenants, including rules that make it possible for them to terminate their lease early.