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Federal Register / Vol. 86, No. 127 / Wednesday, July 7, 2021 / Rules and Regulations
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low-income and minority renters are more likely to be affected by the expiration of the CDCs eviction moratorium and other temporary measures aimed at reducing evictions and supporting renters unable to make their rental payments.
The Federal ERA programs were established to address the concerns about rental arrearages.31 ERA funds may be used to provide assistance to eligible households and their landlords to pay rent, utilities, and certain other housing costs, including arrearages for rent and utility payments.32 Grantees of ERA funds have been working to ramp up their deployment of funds.33 As the CDC has noted, though there are indications that emergency rental assistance has started to reach increasing numbers of households over recent months, there are likely hundreds of thousands of applications for assistance that currently remain outstanding as programs accelerate their 31 Eligible grantees of ERA funds include States including the District of Columbia, U.S. territories, local governments with more than 200,000
residents, the Department of Hawaiian Home Lands, and Indian tribes or the tribally designated housing entity of an Indian tribe, as applicable. See U.S.
Dept of the Treasury, Emergency Rental Assistance Program, https home.treasury.gov/policy-issues/
coronavirus/assistance-for-state-local-and-tribalgovernments/emergency-rental-assistance-program last visited June 25, 2021. Treasury has established two separate ERA programs: ERA1, which provides up to $25 billion in rental assistance under the Consolidated Appropriations Act, 2021, Public Law 116260, 134 Stat. 1182
2020, and ERA2, which provides up to $21.55
billion in rental assistance under the American Rescue Plan Act of 2021, Public Law 1172, 135
Stat. 4 2021. Id. At the same time that funds were allocated for rental assistance under ERA2, the Federal government also implemented additional guidance to increase access to funds by renters most in need of assistance to avoid evictions. For example, Treasury guidance now makes clear that emergency rental assistance provided under ERA2
must be offered directly to renters when landlords do not accept payment. The new guidance also allows rental assistance programs under ERA2 to offer assistance directly to renters before reaching out to landlords. See U.S. Dept of the Treasury, Emergency Rental Assistance Fact Sheet May 7, 2021, https home.treasury.gov/system/files/136/
FACT_SHEET-Emergency-Rental-AssistanceProgram_May2021.pdf. The Treasury guidance was updated again on June 24, 2021 to further support the deployment of ERA funds. See U.S. Dept of the Treasury, Emergency Rental Assistance Fact Sheet June 24, 2021, https home.treasury.gov/system/
files/136/Treasury_Fact_Sheet_6-24-21.pdf.
Treasury has published frequently asked questions FAQs related to the ERA programs, which are available at: https home.treasury.gov/system/files/
136/ERA_FAQs_6-24-21.pdf.
32 See U.S. Dept of the Treasury, Emergency Rental Assistance Program, https
home.treasury.gov/policy-issues/coronavirus/
assistance-for-state-local-and-tribal-governments/
emergency-rental-assistance-program last visited June 25, 2021.
33 See U.S. Dept of the Treasury, Emergency Rental Assistance Fact Sheet June 24, 2021, https home.treasury.gov/system/files/136/
Treasury_Fact_Sheet_6-24-21.pdf.

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activity.34 The Bureau is concerned that renters may be evicted for nonpayment of rent even as they are attempting to access these funds. The Bureau encourages landlords and renters to consider their options under these programs. In addition to the extensive information about rental assistance programs under the ERA available on Treasurys website,35 information about rental assistance programs under the ERA is also available on the Bureaus website.36
The Bureau anticipates that many tenants who face eviction or have experienced economic shocks during the pandemic will seek alternative housing in the rental market. In addition to current renters seeking new housing, the Bureau also anticipates a likely rise in consumers who are currently homeowners seeking rental housing as pandemic-related mortgage forbearance programs and foreclosure moratoria come to an end.37
The Bureau is concerned that information concerning evictions and rental payment arrearages related to the pandemics effects may not be a reliable predictor of a consumers future performance given the extent of the economic dislocation caused by the pandemic. The use of pre-pandemic relationships and scoring models on pandemic data may lead to unreliable conclusions regarding a consumers future performance and may hinder public policy efforts to protect FR 34010, 34013 June 28, 2021.
Dept of the Treasury, Emergency Rental Assistance Program, https home.treasury.gov/
policy-issues/coronavirus/assistance-for-state-localand-tribal-governments/emergency-rentalassistance-program last visited June 28, 2021.
36 See Bureau of Consumer Fin. Prot., Federal Help With Paying Your Rent, https
www.consumerfinance.gov/coronavirus/mortgageand-housing-assistance/renter-protections/
emergency-rental-assistance-for-renters/ last visited June 25, 2021.
37 Under the CARES Act, if a homeowner attests to a hardship related directly or indirectly to the COVID19 pandemic, homeowners with mortgages backed by the government-sponsored enterprises GSEs and federally backed mortgages have the right to request and obtain a forbearance for up to 180 days, and an extension for another 180 days.
CARES Act section 4022b, 134 Stat. 490. Guidance from the GSEs and Federal agencies allow up to 18
months of forbearance. Many servicers and investors of privately owned mortgages not covered by the CARES Act offer similar protections. Further, the CARES Act and guidance from the GSEs and Federal agencies have prohibited lenders and servicers of GSE and federally backed loans from beginning foreclosures through July 2021. When forbearance periods and the foreclosure moratoria end, some homeowners who are significantly behind on their mortgage payments may have limited options to avoid foreclosure if they do not reach agreement with their servicers on a workout option. See CFPB Housing Insecurity Report, supra note 6, at 1113. To the extent these homeowners enter foreclosure and lose their homes, many are likely to seek housing options in the rental market.

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consumers during the pandemic and promote an equitable recovery from the pandemic. Some States and local governments have taken steps to prevent the reporting or use of information related to evictions and rental arrearages arising during the pandemic.38 For example, some States have taken or are considering taking steps to make it easier to seal or expunge eviction records.39
In the upcoming transition period during which the Bureau anticipates both an increase in negative rental information in the consumer reporting system and an increase in consumers seeking rental housing, the Bureau is concerned that existing problems with the accuracy of tenant-screening and other consumer reports will be exacerbated. According to a 2019 report by the National Consumer Law Center NCLC, the vast majority of landlords use tenant-screening reports to screen rental-housing applicants.40 These reports, which are obtained from one of the nations many tenant-screening companies,41 may include traditional credit report data, criminal background history, and rental information.
Inaccuracies in negative rental information included in consumer reports can have significant damaging consequences for tenants future access to rental housing, credit, and other opportunities. For example, an applicant whose tenant-screening report shows past litigation or a poor rental payment history may find it difficult or more expensive to rent property, and many landlords will not rent to an applicant if their screening report shows 38 See, e.g., 2021 Or. Laws Ch. 39 S.B. 282
preventing landlords from reporting to a CRA
nonpayment of rent, charges, and fees accrued on or after April 1, 2020, and before July 1, 2021, and from considering, when evaluating a rental applicant, an action to recover possession if entered on claims that arose on or after April 1, 2020, and before March 1, 2022, or an applicants unpaid rent, including rent reflected in judgments or referrals of debt to a collection agency, that accrued on or after April 1, 2020, and before March 1, 2022.
39 See, e.g., 735 Ill. Comp. Stat. 5/9122
providing that the court file shall be sealed upon the commencement of any residential eviction action during the period beginning March 9, 2020, and ending March 31, 2022.
40 The NCLC report states that 90 percent of landlords run background checks on prospective tenants. Natl Consumer Law Ctr., Broken Records Redux: How Errors by Criminal Background Check Companies Continue to Harm Consumers Seeking Jobs and Housing 3 Dec. 2019, https
www.nclc.org/images/pdf/criminal-justice/reportbroken-records-redux.pdf.
41 See, e.g., Tex Pasley et al., Shriver Ctr. on Poverty Law, Screened Out: How Tenant Screening Reports Undermine Fair Housing Laws and Deprive Tenants of Equal Access to Housing in Illinois Jan.
2021, https www.povertylaw.org/report/tenantscreening-report/.

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