Steve Marr Blog

Steve Marr's contributions

Sep 05

Center for Disease Control Bans Evictions

Posted by: Steve Marr

Tagged in: Untagged 

The Center for Disease Control has issued a moratorium on evictions for nonpayment of rent through December 31, 2020. This order covers all tenants who expect to earn less than $99,000 this year and joint filers expecting to earn less than $198,000. While renters can still be evicted for reasons other than not paying rent, failure to make rent payments alone is no longer grounds for immediate eviction through 2020. 


With 29 million unemployed, many families are hurting and struggling to make rent payments. However, part of my concern over this policy is how the federal government has essentially voided rental payment agreements unilaterally. At the same time, the landlords are stuck with ongoing maintenance costs, mortgages and other expenses. I understand why the government would take an action that appears to help unfortunate individuals, however; this action creates devastating consequences for many property owners including small investors.

My perspective is that if the government is going to issue a moratorium on rent payments, the government should also step in and take the responsibility for paying landlords when rent goes unpaid. I understand this is not necessarily a practical policy.

Realistically, many property owners will not be able to sustain rental properties when not receiving rent for months. I’ve seen a number of instances where small property owners must inform the bank when they can no longer make payments. They must surrender the property because they are no longer able to service a mortgage without rent payments.

Additionally, banks will likely take a loss in some of these properties when they are sold on the open market. With a possibly unstable future rental market, many landlords may be reluctant to buy rental properties.

The situation is real as one landlord, Dennis, expressed it: (please excuse the 4 letter word):

I am a landlord with 3 units and have had my employment cut by the virus.  Two renters have stopped paying, basically saying Trump is protecting them from evictions.

Now I have two units that I will default on my mortgage payments, my property taxes, utilities, and insurance.

My tenants can sue me for failure to pay the utilities, the state can take my property for unpaid taxes, and the insurance policies will be revoked.  What the hell am I supposed to do?  File bankruptcy?  Let the rentals go and watch a deep pockets investor who can wait it out?  Then, at the right time evict all the tenants and raise the rents?

A wise landlord will work with a tenant. When I had a commercial tenant during the 2008/9 recession who was unable to make rent payments, I worked with the tenant to make a plan.  I allowed them to skip several months entirely and pay other months at 50% of the agreed rent payment. Three years later when business improved, the tenant asked me to reduce rent further because they found a better option elsewhere. I declined the request. If the tenant failed to appreciate my past forbearance, I would find a better tenant.

Unfortunately in our current situation, there will be many tenants who will treat this as an opportunity to pocket the cash and not pay rent. When evictions are possible again in January, the courts will probably be clogged and evicting a tenant will become a time-consuming process in many jurisdictions.

We have a responsibility to pay our obligations, including rent. If we find ourselves in a situation where we can’t make rent payments, we need to talk with the landlord and work out a reasonable settlement rather than simply not pay rent. I’ve counseled several individuals who were renting properties they could not afford. In these instances I met with the landlord, explained the situation, and arranged for my client to make partial rent payments while at the same time trying to locate less costly housing.

The Lord taught, “Let what you say be simply ‘Yes’ or ‘No’; anything more than this comes from evil.” (Matthew 5:37, ESV). We need to honor the promises we make. When we promise to pay rent, we need to honor that commitment if possible. My perspective is that if a family eliminates all non-essential expenses like entertainment, cable TV, eating out and other extras and still fall short on paying rent; then, working with the landlord may be a reasonable option. Unfortunately too many people make the decision to stop paying rent, placing increased pressure on our economy and lenders.

Comments (0)add comment

Write comment