California Renters & Property Owners: Eviction Moratorium Things You Need to Know
Credit: @martinadams
Since the state of California extended its eviction moratorium in April through June 30, there has been little information about how it will work, and what landlords and tenants should do about it. Here are some key points and resolution ideas for all involved, as well as some thoughts for commercial tenants behind on rent.
Since AB 2179 passed in late March, many who had not previously applied for rental assistance, or did not qualify, have received summons for an unlawful detainer action (eviction). This was because the extension was intended to serve only those who had applied and were awaiting an answer, or to receive payment. Landlords may file an unlawful detainer before June 30 only if: the landlord/tenant applied before deadline and was denied; or lack of funding or tenant failed to fill out their portion. Tenants who applied before the March 31 deadline and have a pending application or are waiting for payments may not be evicted. However, this is not protection for non-payment of rent after April 1—this bill is meant for those with previous rental debt who applied for benefits, and tenants were responsible for full rent obligations as of April 1, 2022.
So, whether one does or doesn’t qualify for rental assistance, now would be the time to begin thinking about how to resolve the debt and/or living situation as soon as possible—tenants and landlords alike. Currently, folks with rental debt looming have less than two months to make some decisions and take action to better the situation. Rental assistance funds are prioritized based on need, which may leave some folks without everything they need to cover all the debt. At some point, there may be some debt forgiveness program, but that is not an idea anyone should rely on right now. Even if something like this were to happen, many groups with different interests would likely push for less spending, so that, for instance, not everyone may qualify, or forgiveness amounts awarded per applicant could be capped, etc. All of these factors place both landlords and tenants in a position to be motivated to work things out among themselves and avoid the time, expense and stress of court, as well as make their own decisions about resolution to achieve better results.
This is where mediation comes in as an ideal tool to solve these problems. Mediation can help landlords and tenants resolve their issues without incurring the expense of attorneys at all, or for only a short duration compared to in court. Landlords and tenants may be stuck with some debt to deal with despite the government’s help, and the court will only prolong getting answers about what to do next.
Mediation allows people to create customized solutions. For example, landlords and tenants can decide whether continued residence is a viable option, and regardless, find ways to address the debt that can both help the landlord with mounting debts, while finding a realistic solution for individual tenant’s debts and income. The agreements can be legally binding, but are designed to keep the parties out of court. In addition, should additional relief funds become available to some of these residents, they can apply that to the debt they have been working to repay.
While some tenants may not feel inclined to address their rental debt, they will inevitably be forced to deal with it in court. Many landlords may be forced to evict or sue for rental debt because they have no other options to recoup losses. However, evicting people can get expensive, and also time consuming - something that is problematic if the landlord is going without rent in the unit during the eviction process. Therefore, landlords may benefit in the long run by forgiving some of the debt owed by tenants who are willing to participate in mediation to save time and money. Tenants should keep this in mind when trying to decide how to address their debt. It may take some sacrifices, and some creative solutions, but avoiding judgments and evictions on public record should be of paramount importance for tenants as well as the potential for more leniency from their landlord.
It is important to note that for commercial tenants, eviction moratorium protections ended on March 1, 2022. So, commercial tenants owing back rent should really attempt to make an agreement addressing that with their property management. Both of these parties have an interest in trying to maintain their relationship, rather than commercial property owners evicting whenever possible. Many businesses have closed and vacancies present a bit more incentive for commercial property owners to keep current tenants, as incoming tenants may try to drive a hard bargain with so many spaces available.
Whether you’re a tenant or a property owner, everyone is kind of in this together at this point. Sometimes, life gives us some lemons, but being proactive about one’s situation here is key to optimal outcomes for everyone. As always, contact me if you’re curious about using mediation for this purpose!