The Louisiana Weekly, October 12, 2020, CARES Act Expiration Could Mean Financial Meltdown In Louisiana
The new report prepared by Urban Footprint titled, “Homeowners on the Edge: Is America on the Brink of a Foreclosure Crisis,” warns readers that the expiration in January of the federal COVID-19 pandemic economic relief, CARES Act, could trigger a financial meltdown across Louisiana. Housing advocates express worry for the possibility of a mortgage foreclosure crisis on top of those who are already suffering due to the Coronavirus pandemic.
As the country begins the home stretch of the troubled year of 2020, housing advocates are expressing alarm about the possibility of a mortgage foreclosure crisis that they fear could equal or even surpass the financial and economic disaster of 2008.
In a new report prepared by Urban Footprint titled, “Homeowners on the Edge: Is America on the Brink of a Foreclosure Crisis,” researchers warn that the expiration in January of the federal COVID-19 pandemic economic relief, called the CARES Act, could trigger a financial meltdown across Louisiana.
According to the study, an infusion of $140 million per month will be needed to stabilize the situation and head of what housing officials say is a looming mortgage catastrophe in the state. The report revealed that, largely as a result of the pandemic quarantine, 10 percent of homeowners in Louisiana were unable to pay their mortgages in August, including more than 21,000 in Greater New Orleans alone.
By comparison, the 2008 foreclosure crisis saw five percent of U.S. homeowners lose their homes. With a region in southern Louisiana that’s still dealing with the lingering economic effects of Hurricane Katrina and other storms, the factors are adding up, and the writing on the wall isn’t good. And unless homeowners can get assistance from their elected leaders, thousands of struggling people and families – especially in working-class communities and communities of color – could be out on the streets very soon.
“The estimates suggest that 10 percent of homeowners are vulnerable in Louisiana so unless something is done, this will be worse than the 2008 foreclosure crisis,” said Andreanecia Morris, executive director of HousingNOLA. “The implications are staggering, when you think about the victims of Hurricane Katrina who returned and were able to buy being at risk because of COVID and the fact that recovery from the national foreclosure crisis was inequitable.”
