COVID-19 rental info
On April 19, the Consumer Financial Protection Bureau (CFPB) issued an interim final rule requiring “debt collectors” to provide written notice to renters of their rights under the CDC’s eviction moratorium order and prohibiting “debt collectors” from misrepresenting renters’ eligibility for protection from eviction under the moratorium. The rule will go into effect on May 3 and last through the duration of the CDC Order, which was recently extended through June 30, 2021.
To understand whether the rule applies to you, it is important to note the CFPB’s definition of “debt collector,” derived from the Fair Debt Collection Practices Act (FDCPA). According to the CFPB, under the FDCPA:
[The interim final rule requirement] may include lawyers who represent landlords or property managers in eviction court to collect unpaid rent, if they start collecting the debt for [a renter’s] landlord after [renters] fall behind on [their] payments.
We understand that there are other considerations as well, including relevant case law that may be more conclusive about whether property managers or management firms are categorized as “debt collectors,” and whether state eviction laws and court processes separate the process to recover possession from actions to cover outstanding rent debt.
We highly encourage all members to seek the advice of a local attorney before proceeding with an eviction to understand whether CFPB’s rule applies.
As an added protection, we suggest all members consider adding the CFPB’s sample disclosure language to your eviction notice.
CFPB’s Sample Language:
The CFPB’s rule is an unfortunate expansion of the CDC’s Order, and we are continuing conversations with the Administration and federal agency officials about the ongoing challenges that rental housing providers face while the CDC Order and related federal requirements remain in place. In addition to being a bad public policy, these efforts make compliance difficult in an area where there is already an abundance and patchwork of legal requirements complicating the CDC’s Order. This interim final ruling only adds to the confusion as federal, state, and local eviction moratoria are being applied very differently in courts across the country
Emergency Rental Assistance Program Grantee List
Rental Emergency Assistance funding came through in the December 2020 Stimulus Bill and will result in $25 billion being made available to residents who are behind on rent and utilities for Covid-19 related reasons. The funds are distributed like a block grant, to states, territories and substantial counties and municipalities, as well as specific Native American Housing Authorities.
Irrespective of previous income, if a resident lost their job due to Covid-19 and remained unemployed for 90 days or more, they can seek these funds for up to 12 months of arrearage and potentially, an additional 3 months, if needed. Grantees are encouraged to focus significant funds on those residents at less than 50% of the Average Median Income (AMI) for the region.
Please review the Excel spreadsheet linked below, as your state, county, or city may have received funds.
The Department of the Treasury has issued updated Frequently
Asked Questions (FAQs) for the Emergency Rental Assistance Program (ERAP). They
are posted on this website, https://home.treasury.gov/policy-issues/cares/emergency-rental-assistance-program, near the bottom under “Transparency:”
Emergency Rental Assistance Frequently Asked Questions – A summary from our partners at NAA
The key takeaways are the following:
- Emergency Rental Assistance payments made to eligible households are not considered income to members of the household.
- Emergency Rental Assistance payments, including payments for utilities or home energy expenses, made to eligible households are not considered income to members of the household.
- Emergency Rental Assistance payments made on behalf of an eligible household are not considered income to members of the household.
- Rental payments you receive, whether from your tenant or from a Distributing Entity on your tenant’s behalf through a Section 501 Emergency Rental Assistance program, are includible in your gross income.
- Utility payments your company receives, whether from a customer or from a Distributing Entity on the customer’s behalf through a Section 501 Emergency Rental Assistance program, are includible in your company’s gross income.