Can't Pay Rent? Tell Landlords, Document Everything
The COVID-19 pandemic has put millions out of work and many are struggling economically. A new survey by Apartment List found more than 10% of tenants didn’t pay April’s rent, another 13% made a partial payment. VPM spoke with Steve Fischbach, director of litigation at the Virginia Poverty Law Center to learn about options for tenants and homeowners in the state.
What if renters can’t afford this month’s rent?
Steve Fischbach: They should reach out to their landlord as soon as possible and explain the situation to their landlord. If they've lost their job, they should be forthright about that. I work with the Virginia Poverty Law Center and on our COVID-19 page we have a form letter that tenants can utilize for exactly that purpose to request some sort of repayment plan so that they can pay their rents later. They may also, if they are living in larger apartment complexes, want to speak with other people in their building. I know that that can be challenging right now, but it would be helpful for people to know if the landlord is treating everyone the same or is treating people differently because there may be unlawful discrimination occurring, but it is, you know, given that we are practicing social distancing, it makes that a little harder to do so.
If landlords agree to offer tenants rent deferrals, can they still charge late fees? And are these fees capped?
Fischbach: In privately owned housing, landlords can charge late fees as part of a rent deferral agreement or agree to forgo any late fees. In public or subsidized housing, if a tenant loses income they should immediately report the loss of income to their Housing Authority and keep a record of the date that the income loss was reported. In public and subsidized housing, the landlord cannot charge the late fees because there are special rules as part of the federal CARES Act for people who have Section 8 vouchers or live in public housing, as well as other types of federally regulated housing such as low income housing tax credit housing. Are there any caps on late fees, not in privately owned housing. But right now the courts are closed for hearing eviction cases, but that doesn't make the problem go away. It may just kick the problem down the road. Unfortunately.
Have you heard of landlords offering to forgive rent? And if they do, should a tenant get this in writing?
Fischbach: They can, sure. Whether they'll get it or not is another story. A tenant should always get information in writing, particularly an offer of a rent reduction or a rent forbearance. Any of those things needs to be done in writing. That way a tenant can prove to a court or other people that they had some kind of rent reduction or forbearance or something. One thing is that there is a classification of properties that have mortgages by Fannie Mae and Freddie Mac where the government is offering the owner forbearance in exchange for not evicting people. So, that's somewhat helpful, but there's not been a lot of activity around the issue of rent moratoriums — at least here in Virginia. The situation we're in right now is fairly unprecedented and when it comes to real estate, money is always the driving force. So, I'm not aware of any large-scale rent forbearance or freeze. There are a lot of people advocating for that, which makes total sense. But it’s even hard to do that kind of advocacy under this environment because getting people together to organize is rather difficult when you can't have gatherings of more than 10 people.
What shouldn’t renters be doing right now?
Fischbach: Not communicating with the landlord I think is probably the biggest mistake that a tenant can make right now.
The idea of rent strikes has gained some traction nationwide and across Richmond. Is that legal in Virginia?
Fischbach: Well, no. But I want to put some caveats on that. What I mean by no is that people who don't pay their rent can get evicted for nonpayment of rent. It's not like a crime or anything, but if you have a rental agreement with your landlord and you're not paying your rent as your rental agreement requires, that could subject you to eviction.
I spoke with a couple of tenants who can afford their own rent, but said they’re withholding it in support of people who can’t pay. Could that have a blowback for renters who are trying to workout alternative payment plans with their landlords?
Fischbach: It depends on the landlord. For example, if you live in a fairly small complex and you're not paying your rent — I mean the landlord needs cash flow to pay its bills — if they're denied complete cash flow, it makes it harder for a landlord to say to someone, ‘okay, you don't need to pay me.’ If there's a big impact on cash flow, that may jeopardize a landlord's ability to work with people who are directly affected.
On the other hand, it's possible that this kind of activity could convince the landlord, ‘okay, if these folks can pay and, to get their money, I have to agree that people who are directly affected don't have to pay me or have to pay less or something’. I mean, there's really no one-size-fits-all answer to your question. I think from a legal perspective, doing so puts you at risk of eviction.
Currently, can landlords evict tenants under any circumstances?
Fischbach: Well, they can file cases. But while the courts are closed, they won't be heard. And for people who live in public, subsidized, tax-credit or other forms of federally funded housing, they can't bring those cases. Now there's a moratorium on even the filing of rent-related cases. That is until July 25.
What options are there for landlords who are having trouble paying their mortgages?
Fischbach: Those with federally backed mortgages can get forbearance — so, mortgages that are owned by Fannie Mae, Freddie Mac, the Federal Housing Administration, the U.S. Department of Agriculture and the U.S. Department of Veterans Affairs, or VA. All of those have mortgage forbearance programs. A lot of people will not know if their mortgages are backed by Fannie Mae or Freddie Mac, but both of them have online lookup tools.
What resources are available to residents who want to learn about their rights?
Fischbach: On VPLC’s COVID-19 webpage, we've created a number of short papers or flyers on a wide range of issues. Most of what we have up so far deals with housing. But we have other areas — some about unemployment, some about consumer issues in general, about protecting your stimulus check, family law and about getting protective orders because protective orders are still considered emergency cases and they should be able to be heard.