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U.S. eviction bans are ending: here’s what to do if you’re struggling with your rent

U.S. eviction bans are ending: here’s what to do if you’re struggling with your rent
(Image credit: Pixabay)

Millions of American renters are at renewed risk of losing their homes after a federal moratorium on evictions introduced as part of the CARES Act in response to the coronavirus pandemic lapsed on Friday (July 24).

As the spread of COVID-19 began to shut down large parts of the U.S. economy in March, putting millions out of work, a patchwork of state and federal eviction bans were hastily introduced to try and keep people in their homes. 

Now, however, those safeguards are ending, with Reuters reporting that bans have already expired in 29 states and more are to follow. The latest moratorium to end is the federal eviction ban that has been preventing renters who live in buildings with US government-backed mortgages from being removed from their homes. According to the Urban Institute, the federal eviction moratoria had been protecting around 12.3 million - or 28% - of the 43.8 million rental units in the U.S.

How has the situation arose?

The lapsing of such protections is sure to put many households already struggling under the pressure of disrupted incomes and rising debt in an even more perilous position. Compounding problems even further, the additional $600 in unemployment benefits that those out of work had been receiving each week is also coming to an end at the same time. A replacement scheme is under consideration, but likely to see benefits scaled back compared with what was being paid before.

U.S. eviction bans are ending: here’s what to do if you’re struggling with your rent

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While additional help for renters does not appear to have been included in drafts of the new stimulus measures currently being discussed by the Senate, housing experts are forthright in their opinion that more assistance is essential. Emily Benfer, a visiting professor of law at the Wake Forest Law Health Justice Clinic who is the co-creator of Princeton University’s Eviction Lab, says looking at the eviction data is like “watching the United States careen towards the edge of this cliff and there are no guardrails. We cannot stand by as millions of households are about to enter this state of complete devastation. It will take generations to recover from this.”

What is the scale of the problem?

Among the data to which Benfer refers is analysis compiled by Stout, which suggests that as many as 17.5 million households - equating to around 43% of renter households overall and well over 40 million people - are currently at risk of eviction. Putting the gravity of the current situation into context, the 2008 mortgage crisis resulted in 10 million Americans losing their homes across the subsequent years; now, over 11.8 million eviction filings are expected in the next four months. 

Further data from the U.S. Census Bureau highlights the day-to-day struggles that renters are facing. Last month, one in five said they used unemployment benefits to pay their bills, including rent, while one in four used their coronavirus stimulus check. Around one in three renters said they relied on money other than regular income, including savings, credit cards, family loans, or federal aid, while a similar proportion said they had little or no confidence that they will be able to make their next rent payment.

U.S. eviction bans are ending: here’s what to do if you’re struggling with your rent

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What can struggling renters do? 

A myriad of other surveys and reports only support the conclusion that the threat levels to renters are unprecedented. So what can those struggling to pay their rent do and who should you approach if you’re facing the prospect of eviction?

Assess your financial situation

Making sure you have thought of every possible way to improve your financial situation is a must. Careful budgeting is almost certainly something you already practice, but have you applied for all the benefits that you can and have you received your stimulus check - many low-income Americans were recently reported to be in danger of missing out on their payment

Or could you be owed a tax refund - the average being returned to Americans by the IRS is $2,748, so it’s definitely worth reacquainting yourself with the best tax software if you think you’re in credit on your tax. If you have been prioritizing repayments on your credit card at the expense of your rent, maybe now is the time to see if these lenders can afford you some leeway - many have been willing to do so

Talk to your landlord

If you’re concerned about missing rent payments, the first thing that you should do is to talk to your landlord. In a similar way that the best mortgage lenders have been more accommodating to homeowners, so too have many landlords. 

As the National Apartment Association (NAA) points out, many landlords have introduced individual plans, including deferred rental arrangements, to help residents while they get back on their feet during the COVID-19 crisis. Importantly, with no “one approach fits all” solution to everyone’s problems, the NAA encourages owners, managers and residents to “partner together” to find the answer - and that will only come by talking.  

U.S. eviction bans are ending: here’s what to do if you’re struggling with your rent

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Find out what help is available in your state

As already mentioned, most states banned evictions in response to the coronavirus. While many of these moratoriums have either expired or will do soon, some form of ongoing assistance might still be available where you live. A website such as Need Help Paying Bills has a state-by-by state rundown of resources, or you could search on the internet for “rent relief programs” in your area. 

As well as formal state help, there may be charities or other organizations local to you that can provide assistance in the form of advice, social services, loans and local grants. Many local churches have been expanding the support they are offering to those in need too. 

Learn about housing options near you

If it appears that you will need to find alternative accommodation, find out what your state or local area has to offer in terms of transitional housing options - these are places where you could stay temporarily until something more permanent becomes available. As well as approaching your state and county governments, there are also charities that can help too - is a good place to start to see the programs that might be available to you. The National Low Income Housing Coalition also has a state specific rundown of rental assistance programs designed to support individuals and families impacted by COVID-19.

Wider avenues of support

Obviously, it must be hoped that further broad support arrives as part of the new stimulus package that the Federal Government is working on. 

In the meantime, more wide ranging assistance might be found through Fannie Mae’s Disaster Response Network Guide, which offers free support from HUD-approved housing advisors, while HUD itself has a map showing potential resources in your area. Meanwhile, the federally funded Section 8 housing voucher scheme aims to help very low-income families, the elderly, and the disabled to find appropriate and affordable housing in the private market.

U.S. eviction bans are ending: here’s what to do if you’re struggling with your rent

(Image credit: Pixabay)

Assistance specific to certain circumstances 

Additional help may also be on offer to those with more specific requirements. Single mothers, for instance, might be able benefit from help provided by non-profits such as CoAbode, while those living with disabilities might find that public-housing agencies will accept certain HUD development vouchers as well as designated housing vouchers. There are also many supportive programs, such as Veterans Inc. and HUD-VASH, that aim to help veterans with their housing needs. 

It always pays to be aware of your legal rights, particularly if you’re struggling to work out the finer details of your lease agreement. For low-income American households, financial support for legal aid might be available through the Legal Services Corporation

What you should be reluctant to do

If you’re on the brink of eviction, it’s likely that your financial situation is in dire straits overall too. The temptation might be to take out a payday loan to cover your rent, but these are highly risky and should only ever be considered as an option of the very last resort. There are many alternatives to turn to first, such as the best personal loans and credit cards, that might be able to help bridge a financial gap until your situation improves. 

If debt is a millstone that you’re struggling to shake, also consider the best debt consolidation companies that may be able to lower your monthly debt payments and free up some extra funds to pay towards your rent. Whatever your situation, remember that it is always best to talk to the parties involved and those who might be able to help - never suffer in silence, and speak to a debt counseling service if you’re unsure where to turn next.

With over 20 years’ experience in the financial services industry, Tim has spent most of his career working for a financial data firm, where he was Online Editor of the consumer-facing Moneyfacts site, and regularly penned articles for the financial advice publication Investment Life and Pensions Moneyfacts. As a result, he has an excellent knowledge of almost areas of personal finance and, in particular, the retirement, investment, protection, mortgage and savings sectors.