Repayment Plans required for unpaid rent between March 1, 2020-April 30, 2023.
Our Attorneys advise Housing Providers to offer a Repayment Plan for unpaid rents between March 1, 2020-April 30, 2023. A Repayment Plan is not required for unpaid rent accrued after April 30, 2023.
If a tenant has remaining unpaid rent that accrued between March 1, 2020, and six months following the expiration of the eviction moratorium or the end of the public health emergency [April 30, 2023], whichever is greater, the landlord must offer the tenant a reasonable schedule for repayment of the unpaid rent that does not exceed monthly payments equal to one-third of the monthly rental charges during the period of accrued debt.
Court of Appeals Requires 30-day notice to pay or vacate
Court of Appeals opinion is available here.
Message from our attorney:
On December 5, 2022 the Court of Appeals released an opinion that requires a 30-day notice to pay or vacate if the CARES Act applies. This means that if the CARES Act applies, you can no longer use a 14-day notice to pay or vacate and instead are required to use a 30-day notice to pay or vacate. The CARES Act applies unless the loan is not federally back and the property (not only the unit) does not receive section 8 or tax credit.
Given that the additional 16 days isn't going to impact the currently overall time to complete an unlawful detainer, use the 30-day notice to pay or vacate unless you are certain that the CARES Act does not apply.
A copy of the 30-Day Notice CARES Act must be included with the notice to pay or vacate.
NOTE: The impact of this Court of Appeals decision may reach into other notices that require a resident to vacate as an option to comply with the notice. You should consider this when serving notices that require a resident to vacate with less than 30 days notice and seek advice from your attorney.
Am I required to use a 30-Day Notice to Pay or Vacate? Click here to answer a few questions to determine if your property is covered by the CARES Act. Covered Property: any property that participates in certain federal housing programs or that has a federal backed mortgage (15 U.S.C. § 9058(a)(2)). Participation in a federal housing program on behalf of any resident makes the entire property a "covered property." That means if there is one participating tenant in a property, then all of the other, non-participating tenants in the same property also qualify as occupant of "covered dwelling" entitled to the notice required by the Act (See 15 U.S.C. § 9058(b); see also Stacy Burleson v. Sun Plaza Ltd. P’ship, No. D-202-CV-02851 (Bernalillo Cty, New Mexico, July 13, 2021), https://www.nhlp.org/wp-content/uploads/NM-Order.pdf).
Finding out whether a 1-4 unit property is covered by the CARES Act Single-family homes and other rental properties with fewer than five units are generally not listed in publicly-available databases that reveal CARES Act coverage. Though Fannie Mae and Freddie Mac both maintain lookup tools that borrowers can use to find out if their loans are owned by either enterprise, running a search in either database requires a user to include the last four digits of the borrower’s social security number and check a box confirming the user either owns the property or has the owner’s consent to access the information. Is my loan federally-back? Click here.
For multifamily (i.e., 5+ selling unit) properties, a number of public and private databases are available to look up whether they have coverage.
Fannie Mae Multifamily Lookup Tool
Freddie Mac Multifamily Lookup Tool
Ginnie Mae Multifamily Search Pool Search
NOTE: Please note that errors have been reported when using these public databases. Your most reliable source for whether or not your loan is federally-backed in from your lender or loan servicing company.
Consumer Financial Protection Bureau: Protection for Renters in Federally Subsidized Housing
National Housing Law Project: Enforcing the CARES Act 30-Day Eviction Notice Requirement
Two options to consider for use as the required repayment plan form:
Department of Commerce
Repayment Plan form
If a tenant has remaining unpaid rent accrued between March 1, 2020, and six months following expiration of the Governor's eviction moratorium or the end of the public health emergency, whichever is greater, the landlord must offer tenants a reasonable schedule for repayment of the unpaid rent that does not exceed monthly payments equal to one-third of the monthly rental charges owed. If the tenant fails to accept the terms of a reasonable repayment plan within 14 days of the offer, the landlord may proceed with an unlawful detainer action subject to any requirements under the ERP. If the tenant defaults on any rent owed under a repayment plan, the landlord may apply for reimbursement from the LMP or proceed with an unlawful detainer action subject to any requirements under the ERP. During any unlawful detainer proceeding, the court must consider the tenant's circumstances, including any decreased income or increased expenses due to COVID-19, and the repayment plan terms offered during any unlawful detainer proceeding. It is a defense to an unlawful detainer action if the landlord did not offer a repayment plan. The tenant and landlord may continue to seek rental assistance to reduce or eliminate any unpaid rent balance to the extent available funds exist from public, private, or nonprofit rental assistance programs.
Any repayment plan entered into by the landlord and tenant must:
- begin no sooner than 30 days after the plan is offered;
- cover rent only and not legal fees, late fees, or other charges; allow for payment from any source of income, including benefits, assistance or subsidy programs, or from pledges by non-profits, churches, religious institutions, or governmental entities; and
- not include provisions or be conditioned on:
- the tenant's compliance with the rental agreement, payment of attorneys’ fees, court costs, or other costs related to litigation if the tenant defaults on the agreement;
- a requirement that the tenant apply for or provide proof of receipt of governmental benefits;
- the tenant's waiver of any rights to an unlawful detainer notice or related provisions before a writ of restitution is issued.
Tacoma Increases Sales Tax to Fund Affordable Housing
March 31, 2021
Tacoma City Council on Tuesday voted unanimously to approve a one tenth of 1 percent sales tax increase to fund affordable housing projects.
The action increases sales tax from 10.2 percent to 10.3 percent, adding a dime to every $100 purchase, not including groceries. The increase is estimated to net the city an annual revenue of $5 million.
The increase of 1/10 will begin on July 1, 2021. Washington state House Bill 1590, passed in 2020, gives city and county councils authority to vote to raise local sales taxes for housing and does not require them to ask voters for approval.
The funds would target populations making at or below 60 percent of Pierce County’s Area Median Income (AMI), or roughly $51,900 a year for a family of four. The city also can set parameters to target populations below 60 percent AMI. Populations that can be served under the statute include veterans, senior citizens, people without homes, unaccompanied homeless youth and young adults, people with disabilities or domestic violence survivors.
At least 33,000 households, or 40 percent of renter households in Tacoma, are considered “cost-burdened,” or pay at least 30 percent of their income on housing costs each month, and 16 percent of those households pay more than 50 percent of their income on housing costs, according to city data.