What to Do If Your Tenant Claims They Are Unable to Pay Rent Due to Coronavirus

What to Do If Your Tenant Claims They Are Unable to Pay Rent Due to Coronavirus

Coronavirus has been the one thing on the minds of most Californians in recent weeks as every non-essential industry has been forced to close. This also means that thousands of people in the Los Angeles area and across California have not been working for at least the last 2-3 weeks.

Sadly, because many renters who rent multifamily properties in the Los Angeles area have not been working this also means that unless the average tenant has money saved, they will not able to pay their rent next month.

Los Angeles Mayor Garcetti issued an Emergency Public Order On 3/15 Barring Evictions

Due to the economic fallout from coronavirus, the Mayor of Los Angeles issued an emergency public order on March 15 barring landlords from evicting tenants who are unable to pay their rents due to coronavirus.

Tenants who claim hardship from coronavirus must be able to show how coronavirus (COVID-19) has affected them financially. Specifically, they must show that they are unable to pay rent because they lost their job due to coronavirus, taking care of their kids or health care costs related to the virus.

Even though the Mayor’s emergency public order may temporarily help tenants, they must pay the back rent that they owe within six months.

Tenants Must Be Able to Prove Hardship Related to Coronavirus

Yes, coronavirus is indeed a once-in-a-lifetime virus that’s hit us all hard but does that mean that every multifamily property owner in Los Angeles and across California should not evict their tenant next month by default?

The answer to this question is no. Although tenants who are unable to pay their rents should still be treated compassionately, each tenant’s reason for being unable to pay their rent must be evaluated on a case-by-case basis.

Tenants should be ready to show a letter from their employer which proves that they were laid off or had their hours drastically reduced due to COVID-19.

Owners should also ask tenants who claim financial hardship due to coronavirus to provide receipts or bank statements which show that they’ve had increased expenses and are unable to pay their rents.

What happens if a tenant can’t pay their rent and the reason is unrelated to coronavirus? In this instance, it’s permissible for owners to commence with filing an unlawful detainer against their tenant since there should not be any legal barrier that stops the landlord from doing so.

Both Landlords and Tenants Will Be Affected by Coronavirus

There’s no denying that both landlords and tenants are going to be affected by a coronavirus.

Although things like the President’s forthcoming economic stimulus plan that’s supposed to pay individuals an average check of $1,200, the owners and landlords may have to be willing to compromise.

For example, some owners may want to consider temporary rent reductions while others may want to think about asking their tenants to pay a portion of their rents now while offering the tenant the ability to pay the remaining balance over 12 months.

During this time, landlords need to realize that they have to deal with a “new normal” as it may take some time for the Los Angeles area, and California as a whole, to get back to where it was economically before the onset of coronavirus.

Contact MW Real Estate Group

MW Real Estate Group is a long-time multifamily property management company in Los Angeles, CA. We’re experts at sourcing, acquiring and managing investment properties.

To learn more about the services we can offer you contact us today by calling (213) 927-2117 or click here to connect with us online.