Extension on Stay on Evictions

05/08/20

Albeit the Governor staying all evictions, both landlords and tenants should be taking  preemptive measures to protect their interests during these uncertain times. He just announced this week that the he is extending the moratorium for rent relief/evictions for both commercial and residential properties to August 20, 2020. Furthermore, the governor also indicated that late fees and missed payment fees will be banned and that renters may use their security deposit in stead of lease payments.

While many tenants have decided to stop paying rent, it would behoove tenants to amicably work with their landlord and make every effort to continue to pay their monthly rent.  Besides enhancing their reputation and good will, this would put tenants in a strong negotiating position with regards to rent accommodations and other adjustments. Failure to work with your landlord now will merely create animosity; and when the Governor's stay on evictions does end, an acrimonious relationship will only result in expensive litigation for all parties involved. 

During these times, landlords should continue to maintain their property and services, while avoiding aggressive confrontations with their tenants regarding rental payments. Unfortunately, during this economic crisis, landlords are garnering very little sympathy from the courts, the State and their communities.  Therefore, landlords must make every effort to protect themselves and act prudently during these times. When faced with a non-paying tenant, landlords should send multiple rental demand notices. Moreover, landlords should not apply the tenant's security deposit to cover the tenant's rental payments unless such actions are approved by the tenant in writing. In addition, landlords should be seeking all available extensions on their mortgage payments and other expenses while their rental income is delayed. Where possible, landlords should secure a loan or money from the Payroll Protection Plan from the SBA to cover their costs. As landlords have collateral, namely their real estate, they are attractive candidates when seeking loans.  Lastly, landlords should seek $10,000 emergency loans from the SBA, which involve no limitations as to use or repayment. 

While immediate relief for landlords cannot be expected over the next several weeks while the courts are re-opening, landlords should nevertheless be taking preemptive measures. Landlords should send rental reminder notices, not demands. This will be helpful in keeping track of amounts due when the Stay ends and landlords can again serve tenants official demand notices with the threat of eviction for non-payment.  In meantime, landlords should continue to try and resolve matters amicably with their non-paying tenants in order to avoid significant litigation costs and delays. Realistically, courts have historically refused to award landlords legal fees and costs; and in many instances, tenants are judgment proof.

"Working together" is the key to handling landlord/tenant matters during this crisis. The goal is survival, not domination