06 Apr COVID Rent Relief
“Owners must use all payments from this program to satisfy the renter’s unpaid rent.”
Last month the state and qualified local governments finally kicked off a $2.6 billion dollar COVID-19 Rent Relief program funded by the federal government. The program was written to assist low-income Californians who are earning less than 80 percent of the area median income to meet their unpaid rent to residential rental property owners.
Property owners who participate in the rent relief program may be reimbursed for the renter’s unpaid rent between April 1, 2020, and March 31, 2021, if and, yes, it is a big if, they agree to waive the remaining 20 percent of the unpaid rent during the period of time.
Eligible renters whose owners choose not to participate in the program may apply on their own and receive 25 percent of unpaid rent between those dates.
Eligible renters, on the other hand, may receive future rent assistance equal to 25 percent of their monthly rent. Combined with the assistance available for unpaid rent, future assistance will help renters remain housed once eviction protections expire.
Eligible renters may also receive assistance for unpaid utilities and future payments. Unpaid utilities that have accumulated from April 1, 2020, through March 31, 2021, will be paid 100 percent of cost, limited to a total of 12 months.
Owner and/or renter applications must include specific information.
Once an application has been fully processed, the owner and the tenant will be notified regarding the status of the application.
Applications will be accepted on an ongoing basis, not on a first come, first served basis. In our case our local government is to accept and process the application, not the State of California. Part of the process is to assess eligibility. Does the tenant qualify? The first priority will focus on tenants having an income at or below 50 percent of the area median income. So, first things first. Find out if you are eligible. Second, amass the paperwork and information you will need to apply.
For owners, who have one or more eligible renters, you will be reimbursed for 80 percent of each renter’s unpaid rent as noted if you agree to waive the remaining 20 percent of rent during that period.
Owners must use all payments from this program to satisfy the renter’s unpaid rent. Our renters must take steps to verify that they meet eligibility requirements and sign the application.
Before applying, owners will need copies of one of the following:
- Property deed(s)
- Mortgage statement(s)
- Property tax statement
- Copy of a property insurance “statement”
May we suggest that any confidential element should not be provided. Thus, the safest of the four previous requirements is the property tax statement. It is a matter of public record.
If you have ten or more tenants, there is a special form to complete.
There are other elements that you would expect to complete when applying for rental assistance which include:
- Statement identifying the owner or the agent who has legal authority to lease the property. Once again, may we suggest that if you are the management company, you do not need to provide a copy of the actual management agreement. Evidence that you are the management company should simply include a short statement which is signed by the owner.
- A completed IRS W-9 form. Government will report the rental assistance payment to the IRS as income.
- To verify residence, one of the following:
- State issued program ID with license
- Government issued library card
- Utility statements from the utility provider
- To verify ownership, one of the following (please choose carefully as previously noted):
- Property deeds
- Mortgage statement
- Property tax statement
- Insurance (face page)
- To verify rent, one of the following:
- A current signed lease which identifies the unit and rent payment amount (please redact all confidential information)
- In the absence of a lease, evidence of the amount of rental payment may include:
- Bank Statements (there is a significant concern of providing a copy of bank statements).
- Check stubs or other documentation that shows a pattern of paying rent.
- Written attestation by an owner who can be verified as the legitimate owner or manager of the premises.
The application process should be understood prior to submission. Processing can take as little as ten days. The entire program must issue checks to owners by August 1, 2021. We have offered as a member benefit, webinars. May we suggest you attend one of these webinars for a fairly comprehensive hands-on and step-by-step explanation of the rental assistance program.
Are you ready to apply if you have a tenant that qualifies? It is to your advantage to apply. And apply quickly.
Ron Kingston may be reached at [email protected]