Minnesota Representative Ilhan Omar introduced the Rent and Mortgage Cancellation Act on Thursday. The bill would institute a nationwide cancellation of rents and home mortgage payments through the duration of the coronavirus pandemic.
In addition, the bill would constitute a full payment forgiveness, with no accumulation of debt for renters or homeowners and no negative impact on their credit rating or rental history.
Rep. Omar says the legislation will establish a relief fund for landlords and mortgage holders to cover losses from the cancelled payments. It will also create an optional buyout fund to fully finance the purchase of private rental properties by non-profits, public housing authorities, cooperatives, community land trusts, and states or local governments—in order to increase the availability of affordable housing during this downturn.
“Right now, we are facing an unprecedented crisis that has put millions of Americans at risk of housing instability and homelessness,” said Rep. Omar. “While the American Rescue Plan extends the national rent moratorium—this is not a longterm solution. People across this country will be forced to pay tens of thousands of dollars in back rent when it ends. In some cases, local governments are allowing evictions to continue despite the moratorium. In other cases, landlords are going bankrupt due to lack of income. To avoid an even larger crisis, we must cancel rent and mortgage payments during this pandemic. This isn’t a radical idea. It’s what is needed to prevent an even bigger crisis.”