Renters are nearing the end of their financial rope.
People who rent have largely been able to survive the initial months of the pandemic helped by unemployment and federal relief cheques. But the extra $600 in unemployment benefits ceases at the end of July and local eviction moratoriums are expiring.
There is no agreement between the White House and Congress on a second federal relief package.
More broadly, there are fewer supports in place for renters than for homeowners. And as a jump in virus cases in numerous states nationwide injects more uncertainty into the economy and jobs market, many who rent are facing a precarious future.
“It’s an incredibly stressful situation for renters,” said Bruce McClary, spokesman for the National Foundation for Credit Counseling, a nonprofit that works directly with consumers. “I don’t know what lies in the road ahead.”
It’s an incredibly stressful situation for renters.
BRUCE MCCLARY, SPOKESMAN FOR THE NATIONAL FOUNDATION FOR CREDIT COUNSELING
Sam Moore knows this pressure all too well. Shortly after the stay-at-home orders hit in California, Moore and his four roommates who live in San Francisco’s Treasure Island found themselves with no regular income. Only two of them received relief cheques from the federal government, one was receiving unemployment and two are still waiting on it.
The group, all in their early 20s, are looking for work but will have to move in with their families if they are not able to find jobs and face eviction.
Rough time to rent
Renters already faced a dire situation before the pandemic hit, said Alexander Hermann, a researcher at the Harvard Joint Center for Housing Studies.
The centre reported in January that vacancy rates for rentals had hit the lowest level in decades, pushing up rent far faster than income. At last count, one in four renters spent more than half their income on housing.
Then came the pandemic, which hit renters particularly hard financially. US Census data shows about 19 percent of renters were late or deferred their rent payments in May. And about 31 percent of renters surveyed in June said they have little-to-no confidence they will be able to pay next month’s rent.
Renters tend to have lower incomes and to be more economically vulnerable than their homeowner counterparts. They also cannot tap into the equity in their homes as a line of credit in case of an emergency. A disproportionate number of renters are African American, Hispanic and other minorities.
First steps
If possible, tenants should continue to pay rent. Reach out to your landlord or property owner if you are having financial difficulties to see if an agreement can be made. Some landlords are willing to negotiate discounted or deferred payments.
Renters should be sure to take advantage of other relief programmes, as well to free up cash. If they qualify for unemployment, apply as soon as possible because the process takes time. Banks have been willing to make some accommodations for credit card and other loan payments for those financially hurt by the coronavirus pandemic.
Protections
A number of cities and states have put some assistance programmes in place, as well as moratoriums on evictions amid the pandemic.
See if you qualify for help. The National Low Income Housing Coalition has a list of state and local rent assistance programmes on its website. United Way’s 211.org website also has links to local charitable assistance for housing, food and other essentials.
There is also some protection for renters at the federal level.
The Consumer Financial Protection Bureau has helpful information on its website, as well.
Next steps
While you may get temporary relief from eviction, rent is still due.
Tenants may need to work out an arrangement to pay back rent or cope with potential eviction. They may want legal assistance through this process.
Renters can also find a certified housing counsellor through the Department of Housing and Urban Development’s website to see if they qualify for housing assistance or eviction issues.
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