*** The theme of this article was originally published by the Rental Housing Journal on December 14th, 2020***
As of December 27th, President Trump signed a new relief package. In that package, the CDC moratorium was extended to January 31st, 2021. It should be noted that local governments may extend their moratoriums past this date.
Attorneys Jeff Watson, in Cleveland, and Jeffrey Greenberger, in Cincinnati, virtually sat down with Charles Tassell, chief operating officer of National Real Estate Association. The attorneys shared their insights, NOT LEGAL ADVICE, on how landlords and property management companies can best react to the moratorium.
You can hear the full discussion here on YouTube.
“We have gone from unprecedented to crazy,” Watson said. “What concerns me the most is that this is now creating a precedent for future administrations, future agencies, to use this as a rationale, to stop all sorts of economic commerce across the United States of America, any particular form of commerce, any type of interaction, any type of business agreement, (or) consumer agreement that they don’t like.”
Number 1- Landlords can still file evictions
“I need you to understand it’s called a moratorium,” Greenberger said. “It doesn’t mean you can’t file evictions against your tenants.”
He goes on to explain that legal-aid societies are going to provide copies of affidavits for residents to sign, “and they’re going to ask everyone going in, ‘Are you a tenant?’ And they’re going to say, ‘Sign it.’ And they’re not going to tell people that there’s the possibility they could go to prison if it’s not accurate, which is true,” he said.
Most likely, they are going to tell the resident, “You don’t have to leave. You don’t have to pay your rent for the next, at least four months, probably a year,” Greenberger continued. “All you do is sign this piece of paper, no harm, and that’s all wrong, but that’s what’s going to happen. And the problem is that as soon as the tenant signs, that piece of paper – and I’m oversimplifying it a little bit – the court has to stop the eviction.”
He pointed out that attorneys could challenge the affidavits in court and that landlords and property managers need to help out their eviction attorneys by documenting all the proper evidence needed by the courts.
It is highly recommended that landlords and property managers, ask a lot of questions of their local eviction attorneys.
Number 2- Are month-to-month leases better right now?
One of the questions asked is whether landlords would be better off to offer a month-to-month lease, staying away from longer leases.
Both attorneys pointed out that there are too many local laws on lease terms to address on a grand scale. It is recommended that you speak to a local attorney on the matter.
Number 3- Sue Residents for rent, not an eviction
“There is no moratorium on suing people for rent,” Greenberger said. “I think the new moratorium might allow a little crack of light, but it’s a state-by-state, city-by-city possibility. And I think it’s a very slim crack of light. What I’m recommending to people (is) you just sue people for rent – not for eviction – in small-claims court,” he said.
“Some of my clients are hiring me out hourly” to sue tenants, Greenberger said. “We’re not evicting them. We’re just saying ‘you now owe four months in rent and it continues to accrue. And on the day of judgment, we’ll take a judgment against you.’ “ He said once a judgment is entered and the tenant is working, a landlord can take wage garnishment or go after bank accounts.
Number 4- Establish communication with residents and document it
Communication and documentation with residents are important in the federal eviction moratorium.
Watson is advising landlords and property managers to be proactive with residents.
“I have maintained a lot of communication, much more than the normal, with all my tenants during this particular season. And if there’s something wrong, I want to know about it.
“And so, I’m telling folks (to) establish a pattern of communication, because under that CDC moratorium, there’s got to be communication. And if there’s not bilateral communication, then that’s a very big piece of evidence,” which can be presented to the court in the landlord’s favor.
The best way to communicate with millennial residents is through text messages. Take screenshots of the text messages, and keep records to show a court if needed.
He suggested opening up communication with "Talk to me. How can I help you?"
“This is going to be a test of how well do you do your business of being a landlord. Yes, it’s getting infinitely harder. You’ve got a vested interest. You’ve got communication skills. You understand why every word in that lease is there,” he said.
Number 5- Don't bring your phone to court to show evidence
“As a practicing attorney, lots of my clients come into court with me and say, ‘I’ve got text messages,’ and they try to show me their phone,” Greenberger said.
“If you don’t want your phone held as evidence in the court files for the next two years, you need to bring those printed-out multiple copies if you want those entered into evidence, otherwise I have to have your phone seized and entered into evidence. So please don’t do that to me or your own attorney,” Greenberger said.
Number 6- Federal Eviction Moratorium only applies to residents not paying rent
It's important to keep in mind that the CDC moratorium only applies to residents who are not paying rent. If the resident is in breach of their lease agreement for other reasons, you can proceed with filing an eviction. Just know, the eviction will take much longer than pre-COVID.
In the affidavit the tenant is supposed to provide, they have to say, “I have used best efforts to obtain all available government assistance for rent or housing,” Greenberger said. He said the law says everyone in the household must sign an affidavit.
Number 7- The problem is the "one-size-fits-all" with the CDC eviction moratorium
“This is not the time to be doing your own evictions,” Watson said. There is a $200,000 penalty or fine for violating the order.”
The best thing you can do as a landlord and property manager is to make your voice heard on the matter. You can use VOTER VOICE as a platform to speak your voice. This situation is developing and you can expect to see lawsuits across the country regarding the issues discussed here.