PORTLAND, Ore. (KOIN) — An unanswered question regarding coronavirus moratoriums on foreclosures and evictions is just what will happen to home owners once the moratoriums end in coming weeks, both in Oregon and across the nation.

In Oregon, Dec. 31 is the expiration for its eviction and foreclosure moratoriums. There is debate happening now among Oregon lawmakers to extend the deadline until July.

Many homeowners went into forbearance, a special agreement between a lender of a home mortgage and a borrower to delay a foreclosure, because of the pandemic.

Terry Scannell of Scannell Law was wary to note that, legally speaking, forbearance is a form of default, despite forbearances not being negatively reported to credit agencies.

Scannell specializes in complex civil litigation at the Oregon-based law firm, including foreclosure cases. He said he thinks we may see foreclosure evictions happening en masse in this country, but it all depends on how the industry deals with the money owed by individuals that accrued over the course of the pandemic.

“The question is how do you move those people who took the forbearance, which was very, very easy to get, and move them into a position where they’re paying their mortgages again?” Scannell pondered. “And I think that’s where the real trouble is going to come. And how the banks and loan servicers are going to manage that process is going to be critical.”

Depending on how the banking industry approaches the problem may change the outcome. For instance, Scannell said it may be a reasonable outcome that can get people to continue living in their homes and being in good standing if the lenders take the amounts owed cumulated over the pandemic, tack them on the end of the loan and allowing the borrower to gradually pay it off over the whole length of the loan.

On the other hand, there could be a scenario where lenders require additional servicing fees, late fees are required and/or the entire back payment needs to be paid back all at once. If that happens, Scannell said people could get buried in the debt and more and more houses will be foreclosed upon.

According to financial data aggregator Black Knight, in their October 2020 mortgage monitor analysis, 2,765,000 loans were in active forbearance in the U.S., with more than 1 million of those expected to expire at the end of December.

Scannell made many comparisons of the U.S.’s current situation to that of the 2008 Great Recession. He said while the banks got bailed out by the government in that instance, many homeowners were not as lucky and ended up being evicted on a large scale. He said the same thing might happen this time around, depending on how everything unfolds.

“It is a looming crisis that will have to be dealt with,” added Chris Hayes, another lawyer at Scannell Law.

Hayes warns it’s not just mortgages that are mounting up, but student loans and rent as well.

“There is going to be a tsunami of economic collection coming,” Hayes said.

Scannell said their firm does take clients for foreclosure cases, but not pro bono and they are selective about the cases they do take.

However there are free or inexpensive resources for people facing eviction from a foreclosure and experiencing economic hardship, Scannell said. That includes finding a Department of Housing and Urban Development-approved housing counselor, which is a free service, or receiving a half hour legal consultation for $35 through Oregon State Bar’s Modest Means program.