Ask Brian is a weekly column by Real Estate Expert Brian Kline. If you have questions on real estate investing, DIY, home buying/selling, or other housing inquiries please email your questions to [email protected].
Question from Myra in OH: Hi Brian, I’m in tears as I write this. I have a family of three that is facing eviction. Maybe this month, next month, or when the Coronavirus pandemic ends. I’ve tried to do everything that I can to both pay my rent and follow the constantly changing rules to avoid being evicted. But I’m losing the battle. Here’s a short version of what has happened so far.
I live in a small town with about 1,500 people. In April of last year, I was working in the only grocery store in town stocking shelves and working as a cashier. As the virus began spreading, the local people didn’t take it seriously because we are out in the country. No social distancing and no mask wearing. During my work shifts, I was in constant contact with people; helping them find products, bagging products they had handled, and exchanging money. I’ve had health problems in the past that made me decide to quit that job (unemployment was denied). It took me a little over a month to find a new job working from home doing data entry. In June, I missed my first rent payment. It was also later in June when I got sick. At first, I just thought it was stress and lack of sleep from worrying. I pushed forward to keep working from home for another 9 days. That’s when I started having serious trouble breathing and went to the emergency room. Of course, I was diagnosed with the virus. Fortunately, I was never admitted to the hospital but I mostly stayed in bed for a month. Breathing problems, stomach problems, massive fatigue, etc. The virtual company that I had briefly worked for gave me time off without pay and I was able to start working again in early August. Even today, I’m still tired all of the time and can’t work as hard as I did in the past. The job doesn’t pay enough for me to pay the rent, the utilities, and put food on the table. With the help of a friend, I’ve been able to pull in a few public help resources but I’m still going backward financially.
I’ve missed eight months of rent to the tune of $4,000. I did find a rental assistance program that paid one month of my $500 rent. That left me with an outstanding balance of $3,500. From stimulus checks and by scraping up as much as I could, I paid another month, so that my current outstanding rent balance is $3,000. But in the middle of January, my nightmare got a lot worse. My apartment building is owned by a group of partners that had the court issue an eviction order that can’t be enforced today but will be enforced sometime in the near future. They also sent me a letter saying that they are not accepting future rent payments unless it includes a minimum $250 payment on the back rent. On top of that, as part of the court paperwork the landlords denied receiving the required CDC paperwork that I sent to them. I’m down to hoping that I’ll soon receive another stimulus check and will be able to make a $750 payment. But that won’t happen until at least late March or April. By then, I’ll be two more months behind with the rent. Is there anything else I can do before my kids and I are out on the street?
Answer: Hello Myra. I’m sorry that you’ve become part of the estimated 40 million people that are in danger of eviction or foreclosure. I certainly appreciate how difficult it has been trying to figure out what to do next. I’ve lost track of how many times the rules have changed, which ones apply today, and what is different from one state to another.
At 40 million people, this is 4 times the number that faced a housing crisis during the Great Recession. This is almost certainly the most severe housing crisis in our history. Myra, without knowing all of the current eviction rules in your state, county, and municipality, what your landlords are doing is probably mostly legal. In support of landlords, many eviction moratoriums allow landlords to proceed with evictions up to the point of obtaining a court order for eviction but the sheriff cannot enforce the order until the moratorium expires. This is causing yet another problem for renters because ongoing eviction cases are in the public records. Unless these are wiped out from public recorders (unlikely), the eviction will stay with the renter long after the pandemic is over.
Myra, these have become unprecedented times and there are very few answers available to people in situations similar to yours. I’m not aware of any legislative action that is in-work to resolve the back-rent or eviction dilemma we are in. I think that one big problem you are facing in the future is the eviction order remaining on your court record. Even landlords that are lenient about damaged credit reports or a sketchy work history will draw the line about not renting to a person with an eviction on his or her record. Possibly the only thing that will make a difference after the pandemic is over is that millions of renters will be in the same situation. Until some useful legislation is passed, there are only a few things that you can do now to minimize the future impact on your ability to find another rental home.
Going forward, you should continue looking for rent assistance. In December, Congress approved $25 billion to assist struggling renters and landlords. These funds are only now beginning to reach the states and cities. These are intended to cover up to a year of back rent. You’ll need to look locally for agencies administering these new funds.
Also, try to stay current with the changes that are happening. Here are a few links that should help:
Consumer Financial Protection Bureau: Help for Renters.
Fannie Mae: Renters Resources Finder. If the Renters Resource Finder confirms that Fannie Mae financed the apartment complex where you live, you should be eligible for COVID-19-related tenant protections. If your landlord or property owner received payment relief on the financing that Fannie Mae provided (known as forbearance), these protections could include:
Freddie Mac: Is my apartment building financed by Freddie Mac? The same provisions that apply to Fannie Mae financed properties also apply to Freddie Mac.
What suggestions can you share with renters or landlords during these trying times? Please comment.
Our weekly Ask Brian column welcomes questions from readers of all experience levels with residential real estate. Please email your questions or inquiries to [email protected].