Four takeaways on landlord-tenant law during the pandemic
By Austin Fax
Amid the global COVID-19 pandemic, there is perhaps no field that has been hit harder in society than residential housing. With certain industries shut down and jobs being lost, it is becoming increasingly harder to make ends meet. Tenants may have real fears about when and how they are going to be able to pay their rent. Similarly, landlords may have concerns about their businesses or paying their mortgages without a steady stream of rental income. Unfortunately for both parties, there has been a lot of misunderstanding or misinformation regarding the current state of landlord-tenant law and the changes that have been made in the past few weeks. Below are my four biggest takeaways on the topic.
1. Rent is still due
The most common misconception that I have repeatedly heard or received questions about in the past few weeks is whether tenants are still obligated to pay rent, or whether there is a “moratorium” on rental payments. In Missouri, regardless of whether you are dealing with a property impacted by new federal legislation or not, rent is still due and owing according to the terms of your lease. There may be some situations in which a landlord is barred from instituting eviction proceedings or filing a lawsuit based on the non-payment of rent (more on that below), but that does not mean tenants can simply stop paying rent. To that end, communication between a landlord and tenant is key. If timely rental payment is going to be a problem, it is important for both sides to address that issue as soon as possible.
2. The landscape is rapidly changing and may differ depending on where you live
The second biggest takeaway I have is that the information I am giving you regarding the current state of the law may change in the next few weeks (or even days). In the past few weeks, I have given multiple talks about this topic to our community and to my clients and each talk has been slightly different. The truth is that no one knows how long this pandemic will last. Even if businesses are re-opened soon and life resumes some semblance of normalcy, there may still be changes to our laws addressing the potential backlog of cases that have not been heard or the influx of new eviction filings. Or those changes may not happen.
If someone tells you they know for certain what the landscape of landlord-tenant law will look like in the next few months, they are selling snake oil.
In addition to the changes over time, your situation may differ depending on where you live in the state. To date, Missouri has not passed any state-specific laws regarding landlords and tenants in response to the pandemic. However, municipalities and circuit courts may have their own rules that differ. For example, some counties may have local ordinances regarding shutting off utilities that do not apply to the rest of the state. The Supreme Court of Missouri has suspended all in-person hearings for the state until at least May 15. After that date, some circuits may be able to hear cases quicker than others.
To that end, there has never been a better time to consult a trusted attorney if you are dealing with an issue related to the non-payment of rent or otherwise. Our job is to keep apprised of the changes in the law and determine how they will impact you and your situation.
3. The CARES Act impacts federally governed or backed properties
The President signed the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act into law March 27, 2020. A common misconception is that because it is a federal law, the CARES Act applies to all residential rental properties in the United States. This is not true. The law only applies to a small minority of properties that are defined by the CARES Act as a “covered dwelling,” which includes those dwellings in a “covered property.” A “covered property” is defined by the Act to include properties that participate in a “covered housing program” as defined by the Violence Against Women Act (VAWA) or a “rural housing voucher program under section 542 of the Housing Act of 1949.” It also applies to properties with a “federally backed” mortgage loan or a federally backed multifamily mortgage loan.
Though not an exhaustive list, covered housing programs under VAWA include HUD related properties, such as those properties rented under the Housing Choice Voucher program, properties rented under what is commonly referred to as Section 8 project-based housing, Section 811 housing for people with disabilities, and other federally governed, assisted, or subsidized rentals. In addition, properties with federally backed mortgages also apply. These would include properties backed or secured by Fannie Mae, Freddie Mac, or even the VA.
Though the list of definitions under the CARES Act is lengthy, most properties do not fall under any of the categories above. Therefore, Missouri state law would apply and there is no “moratorium” at all on filing an eviction for the non-payment of rent. In the event the CARES Act does apply, the law provides that a landlord may not “make, or cause to be made, any filing with the court of jurisdiction to initiate a legal action to recover possession of the covered dwelling from the tenant for nonpayment of rent or other fees or charges” for a period of 120 days from March 27, 2020.
Simply put, a landlord can still demand rent from a tenant and the rent is still due. But if rent is not received, the landlord cannot evict a tenant or file a lawsuit to evict a tenant during the period of the moratorium. Moreover, after the moratorium ends, the landlord is required to give 30-days notice before initiating an eviction. The landlord is also prohibited from charging late fees, interest, or other fees related to the non-payment of rent during the moratorium period.
4. This too shall pass
In my lifetime, we have never experienced anything quite like the pandemic facing us now. Many have lost loved ones. Others have lost jobs or financial security. Some will lose their homes. Things may get worse before they get better. No one knows when, but eventually there will be a light at the end of the tunnel.
With respect to housing, help is hopefully on the horizon. Congress has already allocated millions of dollars, and possibly up to approximately $3 billion, to HUD to help individuals to safely remain in their homes or access temporary housing assistance in response to economic and housing disruptions caused by COVID-19. Local non-profits and service organizations are working tirelessly to try and connect those impacted with the resources they need to get back on their feet.
We are going to get through this together. In the meantime, be kind to one another, landlords and tenants alike.
Austin Fax is an Association with Lowther Johnson Attorneys at Law, LLC, handling a wide range of practice areas including personal injury, real estate and property law, labor and employment, business law, landlord-tenant, and creditor’s rights.