The Seattle City Council last week voted to extend an eviction moratorium for 6 months after the current emergency coronavirus protections end on June 4. This bill provides a defense for residential tenants against rent-related evictions if he or she is unable to pay rent due to financial hardship caused by coronavirus-related business closures.
The existing eviction moratorium prohibits evictions due to non-payment of rent. It also prohibits late fees or fines due to late or missed payments. While landlords cannot initiate any eviction action during this period, tenants may still incur debt during this time.
With 23.1 million U.S. residents unemployed in April, landlords expect that many tenants will be unable to pay rent in the coming weeks and months. “No one should have to worry about losing their home in the middle of a pandemic,” said Council President Lorena Gonzalez.
Last week’s bill extends the Seattle eviction ban to December, at which point the previously passed winter eviction ban will kick in (except for landlords with 4 or fewer units). Between these two legislative actions, this effectively blocks many landlords from evicting tenants for up to one year.
Seattle Mayor Jenny Durkan “believes people should be able to stay in place” and is expected to sign the eviction ban bill into law.
As a result, many landlords fear missing mortgage payments and lost income for an extended period of time will force them to sell or lose their property. Others might think twice before renting to lower income tenants in the future in order to protect themselves from situations like this. Some still are predicting many “mom-and-pop” landlords will be replaced by developers who will tear down affordable rental housing stock in favor of new and expensive luxury townhomes.
What an eviction moratorium means for landlords
This new Seattle eviction ban is specific only to Seattle right now. However, it would not be a surprise for other cities to follow suit with extended eviction bans of their own. Many cities and states already have their own temporary eviction moratoriums due to the COVID-19 economic crisis. As the downturn continues or worsens, expect to see continued rises in unemployment and struggles for tenants to pay rent. We have previously recommended that landlords work with their tenants who cannot pay and expect that most are doing so. However, some states and city governments will want to enact this into law.
What you can do if faced with an eviction moratorium
Tenant screening software
Reviewing applicant screening reports is one of the most important tools landlords have in determining who to accept as tenants. With current and extended eviction bans, make sure your screening process reduces the risk of unqualified tenants and unpaid rent. Effective screening, credit reporting, background checks and eviction history helps identify potential concerns before they become problems.
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Rental criteria checklist
Your rental criteria checklist is a guide to help you streamline the tenant selection process. While the goal is to determine if a prospective tenant will pay rent on time and take care of your property, using a screening checklist can also protect you in the event of a discrimination claim. It ensures your tenant screening process is documented, objective and fair, as well as consistent across all properties and applicants. If faced with an eviction moratorium, you may feel the need to increase your minimum criteria now more than ever. Your rental criteria checklist helps ensure you apply this fairly and objectively for all applicants.
Rent payment software
Make it easy for your tenants to pay rent to you. Setup online rent payments through one of the rent payment software providers. With multiple payment options, your tenants can choose to pay by ACH/bank transfers, debit or credit cards, PayPal, Stripe, or even cash payments in some cases. Tenants can even set up automated and recurring payments so that rent automatically transfers on a specified date each month.
Some rent payment services also allow for partial or reduced rent payments. In some cases this may be helpful if your tenants experience a temporary inability to pay rent right now.
Most payments deposit into your bank account within 3 business days, but some have options to expedite payments if necessary.
Legal advice and documents
As the global health and economic crisis continues, we believe more renter protection measures and eviction bans will become enacted. Keeping up with and complying with these regulations has become much more challenging for property owners and managers. A landlord’s best approach in navigating these changes is to carefully craft a set of procedures for selecting tenants. It is also imperative you have access to proper leases, forms and notices at your disposal should you be faced with an eviction moratorium in your city.
Landlord-Tenant Guides at Nolo:
Knowing and complying with dozens of laws and using the proper forms is crucial for landlords. Nolo experts provide the legal answers (including the latest state laws) and forms landlords and tenants need to protect their rights and avoid costly legal fees and lawsuits. Nolo books and forms cover a wide range of issues – from what’s legally required (or prohibited) in leases, rental applications, and other forms, to landlord-tenant rights and responsibilities when it comes to repairs, tenant privacy, late rent, security deposits, roommates, pets, broken leases, and evictions.
Are you a landlord needing legal information? Nolo has the answers to your questions – check it out today!
FormsGateway.com is the leading online provider of business and personal legal forms and contracts. They have a comprehensive database of legal forms of over 10,000 documents. You can purchase and download state-specific residential lease and sublease agreements, eviction notices, rental applications, property inspection checklists, and more.
There is unprecedented economic uncertainty due to the COVID-19 crisis. It is an especially difficult time for landlords. With growing calls for rent strikes and eviction bans, make sure you are protected in the event your city or state passes an eviction moratorium.
Let us know if your city or state has an eviction moratorium. Send us your comments below.
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