Moratorium
A moratorium is a temporary suspension or delay of a specific activity, often imposed by government authorities or agreed upon by parties in a contract. In real estate, this commonly refers to temporary halts on foreclosures, evictions, or development projects.
Example
“The city council imposed a six-month moratorium on new apartment construction while they reviewed zoning regulations.”
Memory Tip
Think 'MORE-atorium' - you need MORE time, so activities are temporarily stopped.
Why It Matters
Moratoriums can provide crucial breathing room for homeowners facing financial hardship or tenants at risk of eviction. They can also affect property values and investment timelines when development projects are temporarily halted.
Common Misconception
Many people think a moratorium permanently stops an action, but it only provides a temporary delay.
In Practice
During the COVID-19 pandemic, many states implemented foreclosure moratoriums to protect homeowners who lost income. A homeowner behind on mortgage payments could avoid foreclosure proceedings for several months while seeking loan modification or other relief.
Etymology
From Latin 'moratorius' meaning 'delaying,' derived from 'morari' (to delay), literally meaning 'that which causes delay.'
Common Misspellings
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