COVID-19 Help for Tenants & Rental Property Owners. The ongoing economic crisis resulting from the Corona Virus has created a number of financial issues for tenants & rental property owners.
Here at San Diego Premier Property Management we put in place early measures to communicate with our residents. Our compressive and compassionate rent payment options have proven to be very effective.
As of April 5th we’ve received 92% of our expected rent roll.
Unfortunately, the real challenge for tenants and rental property owners may be for the month of May and beyond. Therefore, the following resources and information is for those who may need emergency financial assistance during this time of uncertainty.
All of the information provided below entails dealing with your loan service provider.
Please find the following Federal & State assistance resources available below.
Federal Assistance | COVID-19 Help For Tenants & Rental Property Owners
What assistance is available for a rental property owner under the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act?
The CARES Act requires servicers of federally owned or backed mortgages to grant forbearances to single- and multifamily rental property owners who suffer economic hardship due to the COVID-19 crisis.
What type of loan must I have to qualify for mortgage forbearance under the CARES Act?
Your mortgage loan must be federally owned or backed by one of the federal agencies listed below to be eligible.
If you do not know who owns or backs your mortgage loan, please call your servicer.
Your servicer has an obligation to provide you, the name, address and telephone number of who owns your mortgage loan.
List of federal agencies and entities:
Fannie Mae
Freddie Mac
Federal Housing Administration
U. S. Department of Agriculture
U.S. Department of Housing and Urban Development U.S. Department of Veterans Affairs
USDA Direct
USDA Guaranteed
What qualifies as a “single-family” property for purposes of the foreclosure moratorium and the borrower’s right to request forbearance?
For these purposes, “single-family” means homes designed for one to four families.
How do I request mortgage forbearance as a single-family rental housing property owner?
Single-family rental property owners with federally owned or backed mortgage loans may request forbearance directly through their loan servicer.
Upon making the request, the rental property owner must affirm they are experiencing an economic hardship due to the COVID-19 crisis.
Aside from this affirmation, the loan servicer may not require the rental property owner to provide any additional documentation to facilitate the forbearance request.
How do I request mortgage forbearance as a multifamily (five or more dwelling units) rental housing property owner?
The same requirements apply to multifamily rental property owners as specified above, with a few caveats. As a condition of any mortgage-payment forbearance request, a multifamily property owner must have been current on mortgage payments as of February 1, 2020.
In addition, a multifamily property owner also has the option of making an oral or written forbearance request.
Please note: Multi-family rental property owners who receive forbearance assistance under the CARES Act may not evict — or even initiate an eviction of — a tenant solely for nonpayment of rent or other fees or charges.
For what period of time may I request forbearance on my single-family rental property?
The length of the forbearance is dictated by your request.
An initial forbearance may not last longer than 180 days, but you may request to extend the period by an additional 180 days. You may also request a shorter forbearance period.
For what period of time may I request forbearance on my multifamily rental property?
The forbearance period is shorter for multifamily rental property owners.
A forbearance may not initially last longer than 30 days. However, you may request to extend this period twice, each time for an additional 30 days.
Any extension request must be made during the “Covered Period” and at least 15 days prior to the end of the current forbearance period. Please note that multifamily property owners may discontinue a forbearance at any time.
* The term “Covered Period” means the period between the enactment of the CARES Act and whichever of the following occurs earlier: (1) the end of the national COVID-19 emergency, or (2) December 31, 2020.
Will I accrue interest, fees and/or penalties during forbearance?
No Additional interest, fees, and/or penalties are permitted under the CARES ACT, during the forbearance period.
However, the accrual of interest and the imposition of fees and penalties are permitted, but only if they are consistent with the existing loan documents.
Will forbearance negatively impact my credit score?
No. If you are granted forbearance during this temporary period, you will not have derogatory information related to those deferred mortgage payments reported to credit reporting companies.
Is there anything in the CARES Act regarding evictions?
Yes. Regardless of whether a rental property owner has requested a forbearance, the CARES Act imposes a 120-day moratorium on tenant eviction filings and charging late fees for any property secured by a “federally backed” loan for both “single-family” and “multifamily” properties. Between March 27, 2020, and July 24, 2020, (the 120-day period), owners of properties with covered loans may not make any filing to recover
The possession of properties from a tenant for nonpayment of rent or other fees or charges, and may not charge fees, penalties or other charges to the tenant related to nonpayment of rent. Notice that this nonpayment of rent is not necessarily related to nonpayment due to a COVID-19-related circumstance.
Additionally, rental property owners may not require tenants to vacate sooner than 30 days after providing notice to vacate, and they may not issue a notice to vacate until after July 24, 2020. This last provision makes no reference to nonpayment of rent or any other violation of the lease. Its meaning is unclear, but it likely means that a rental property owner is not entitled to evict without cause during the 120-day period.
State Assistance | COVID-19 Help For Tenants & Rental Property Owners
What financial assistance is being coordinated by the state?
In coordination with the State of California, Citigroup, JP Morgan Chase, US Bank, Wells Fargo and close to 200 state-chartered banks, credit unions and servicers have committed to providing relief for single- and multifamily rental property owners in California.
Rental property owners who are struggling due to the COVID-19 crisis may be eligible for a 90-day grace period for all mortgage payments. A list of contact information for these financial institutions may be viewed by clicking here.
What does this 90-day grace period entail?
The above financial institutions are offering mortgage-payment forbearance for up to 90 days, which allows rental property owners to reduce or delay their monthly mortgage payments.
This includes providing you: 1) a streamlined process for requesting forbearance due to the COVID-19 crisis, supported with available documentation; 2) a confirmation of approval of, and the terms of, the forbearance; and 3) the opportunity to extend your forbearance if you continue to experience hardship due to the COVID-19 crisis.
How may I obtain this assistance?
For more information and details on how to apply for available relief, you should contact and work directly with your mortgage loan servicer.
Will this grace period last longer than 90 days?
The above financial institutions have, for the time being, currently committed to 90 days of assistance, but further commitments may be worked out between the state and these institutions if the COVID-19 crisis continues to worsen.
Will I have to pay fees and charges during this 90-day grace period?
For at least 90 days, the above financial institutions will waive or refund mortgage-related late fees.
What effect will this assistance have on my credit score?
Financial institutions will not report derogatory information (e.g., late payments) to credit reporting agencies, but may report a forbearance, which typically does not alone negatively affect a credit score.
What if my financial institution isn’t offering this assistance?
At this time, Citigroup, JP Morgan Chase, US Bank, Wells Fargo and close to 200 state- chartered banks, credit unions and servicers are supporting these commitments. Additional financial institutions may make these commitments in the upcoming days and weeks.
What if my mortgage servicer is not communicative or cooperative?
You can file a complaint with the Department of Business Oversight (DBO) through the complaint form on the its website (https://dbo.ca.gov/file-a-complaint/) or by contacting the DBO Consumer Services Office at (866) 275-2677 or (916) 327-7585 or via email
at Ask.DBO@dbo.ca.gov.
Tenant Q&A | COVID-19 Help For Tenants & Rental Property Owners
Unfortunately, there is a lot of misinformation out there regarding evictions and rent payments.
As of 4/16/20 There is “No” moratorium on paying rent.
Rent is not being suspended so unless your income has been directly affected and you’re able to provide verifiable proof, tenants will most likely be expected to pay their rent in accordance with their lease agreement terms on time.
If you’re unable to pay rent due to a verifiable loss of income, please communicate with your landlord or property management company to discuss further.
Proof of financial hardship directly related to the Coronavirus may required:
Examples include but are not limited to:
- Notice of job closure or loss
- Temporary closing without pay
- Mandated quarantine without pay
Below are some additional tenant questions and answers
When is the tenant required to notify the landlord in writing that they are unable to pay the rent?
No later than seven days after the rent is due. Within that time, the tenant must inform the landlord in writing that the tenant needs to delay all or some portion of the rent due to COVID-19 reasons.
Is the tenant required to provide verifiable documentation?
Yes. However, this documentation only needs to be provided to the landlord on or before the tenant actually pays the back rent.
What counts as verifiable documentation?
Termination notices, payroll checks, pay stubs, bank statements, medical bills, or signed letters or statements from an employer or supervisor explaining the tenant’s changed financial circumstances.
Does this mean that the landlord will be waiving the right to collect all rent?
No. There is nothing in the order that limits the right of the landlord to eventually collect all the rent that is due. The tenant still owes the entire amount of unpaid rent.
If a tenant cannot pay the rent due to a COVID-19 related substantial reduction in income, do they still owe the rent?
Yes. Nothing in these city/county orders will relieve the tenant of the obligation to pay rent. However, many of the local orders will give the tenant up to six months to make up the back rent. Check your local city/county order.
If the tenant does not pay the rent due to a COVID-19 related reduction in income, can the money be deducted from the security deposit?
Yes. Under most leases, including C.A.R.’s residential lease agreement, any time rent is due and not paid, it may be deducted from the security deposit.
What about lock-out orders?
Under the governor’s order, no lock-out of a tenant can take place as long as the tenant has met the rules as described above.
When does this order expire?
The order expires after May 31, 2020.
We hope you enjoyed reading COVID-19 Help For Tenants & Rental Property Owners
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Written by Salvatore Friscia, owner of San Diego Premier Property Management a full service residential property management company offering Worry Free property management to the greater San Diego area since 2004.
