What The Eviction Moratorium Means For Real Estate Investors in the Hudson Valley

The ban on evictions are set to expire at the end of 2020. This was enacted to help prevent a wave of evictions that the CDC believed would spread COVID19 through renters. This applied to those qualifying for the CARES act, who had fallen behind on rent payments, preventing them from being forced into crowded living conditions. These individuals must have submitted a declaration stating the pandemic has caused hardship, be able to prove that they have reached out and applied for any and all financial assistance available, documentation is advised. Here’s what the eviction moratorium means for real estate investors in our area.

Other Reasons

Evictions for reasons that are not related to delinquent rent during the eviction moratorium may still be processed – you don’t have to tolerate tenants committing criminal acts, threatening other tenants, or any other legitimate reason for eviction! Be certain you’re aware of not only the standing CDC order but any state or local government orders regarding tenants and evictions. Civil penalties for the landlord and/or the resident are a risk, landlords can be fined rather hefty sums. Tenants who cannot respond affirmatively to all qualifying questions don’t qualify. They sign the document under penalties of perjury. 

Partial Rent 

A large problem of this is that when the order expires, not only will the unpaid rent still be owed by the tenant, their monthly rent payments will be due in full moving forward. Discuss a plan with your tenants to begin making partial payments towards the monthly payment to the best of their ability, during the covered period. Otherwise, unpaid rent for real estate investors in New York under the rules of the eviction moratorium, means either financing the missing income from other sources or taking your tenants to court to sue for back rent. The outcome of the latter of these options is suspect at best, considering that financial hardship is the very reason for the non-payment of rent. 

Filing Evictions

Though cases won’t be heard until the order expires, an update to the original eviction moratorium from the CDC means real estate investors can start eviction court proceedings prior to the expiration of the order. The eviction cannot take place during the time period covered by the order. This update provides clarification on what is and isn’t covered under the guidelines of the order and can be found under the frequently asked questions section of the CDC website, as a document. In most cases, evictions take between 3 to 30 days. Depending on the local laws governing the property issued at the end of the moratoriums put in place due to the pandemic, courts will begin processing evictions. These eviction proceedings may begin as early as January of 2021. Landlords should remain aware of updates on recent court cases that have been filed, fighting the moratorium on behalf of landlords, based on the premise that the CDC doesn’t have the constitutional authority to enact policies on rent.

Repayment Plan

Whenever possible real estate investors should consider devising a repayment plan for the back rent that has accumulated during the eviction moratorium. In many cases, landlords and tenants have an amicable relationship and wish to do whatever is possible to maintain the current arrangement. If both parties can afford this option and are agreeable to the amount that would be added in monthly amounts, in addition to future rent payments, you could keep your good tenants. As an added bonus, you will know you have helped a family keep their home. It would be best for all parties if you could work with your tenants well in advance of the looming deadline. 

Document Communication

When communicating with tenants under the protection of the eviction moratorium, real estate investors in the Tri-State area would be wise to carefully document all communication. Should things progress legally, every piece of evidence available  will be important to show your actions and whatever steps taken to work with your tenants during this time.  Your documents will also provide backup, should your tenant attempt to omit any facts during the court proceedings, you can protect yourself from such a possibility with careful record-keeping. 

We Buy Tri-State Homes is happy to answer any of your questions or concerns about what will happen to renters after the new year. Just reach out to our team by sending us a message or giving us a call today at 929 209 4724!

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