Consumer Watchdog issues guidelines to strengthen the national eviction moratorium

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The Consumer Financial Protection Bureau announced a preliminary ruling on Monday that will allow tenants to sue debt collection agencies who violate the national eviction ban.

Landlord attorneys and other debt collection agencies who falsely evict tenants could also face criminal prosecution, the office said. In addition, these collection agencies must now inform the tenants in writing of their rights from the eviction ban and deliver an evacuation notice on the same day.

“No one should be evicted from their home without understanding their rights, and we will hold debtors accountable who promote illegal evictions,” said Dave Uejio, acting director of the CFPB, in a statement.

The announcement is a sign that the Biden administration plans to more aggressively enforce the national eviction ban on the Centers for Disease Control and Prevention, first enacted by the Trump administration in September.

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With coronavirus cases and unemployment rates still high, President Joe Biden has since extended the moratorium to the end of June.

Research has shown that evictions in one area lead to significantly more coronavirus cases and deaths.

Housing advocates point out that the law failed to protect many tenants because there weren’t enough consequences for violating it.

There is no national database of evictions. Since the CDC ban went into effect, Jim Baker, executive director of the Private Equity Stakeholder Project, has counted more than 57,000 new evictions filed by corporate landlords in Arizona, Florida, Georgia, Nevada, Tennessee and Texas alone. During the same period, Princeton University’s Eviction Lab identified more than 218,000 evictions in the five states and 19 cities it is tracking.

“We are still seeing mass evictions, even with CDC orders,” Daniel Rose, organizer at Housing Justice Now in Winston-Salem, North Carolina, told CNBC in December.

Evicting tenants is a last resort, National Apartment Association president Bob Pinnegar told CNBC earlier this year. However, the last year has marginalized the landlords, he said.

“Over 50% of rental housing providers in the country are mom and pop owners who rely on their few housing units as their only source of income,” he said. “The reserves are running out and in many cases are exhausted.”

Still, the consumer bureau made it clear on Monday that property owners’ lawyers or other debt collection agencies who illegally or without informing tenants of the CDC ban could be negatively affected by federal agencies and attorneys general, as well as private individuals.

“The rule directly addresses many of the issues that undermined the moratorium, including tenants’ lack of knowledge of rights, abusive practices, and minimal to no enforcement,” said Emily Benfer, eviction expert and visiting law professor at Wake Forest University.

The office also shared information on where renters and landlords can find organizations to apply for the billions of dollars in rental aid granted in the latest stimulus packages.

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