Rent is due. Now what?
Renters often feel a lack of control over their living situation. Now COVID-19 brings on a new layer of life and income uncertainty making this feeling worse. With rent coming due, renters are asking what options do they have? While as a renter you can’t call your bank and ask for mortgage relief, there are still many things you can do and new protections to be aware of.
GET YOUR FINANCIAL HOUSE IN ORDER TODAY
This is my recommendation for everyone right now. You might have a job today, but who knows how long any of this will last. It’s best to be over prepared.
For those of you who feel uncertain about paying your upcoming rent in full, the first thing to do is get your own financial house tidied up. Also, it makes no sense to ask your landlord about what they can do for you, before you first see what you can do for yourself. So time to make your money stretch.
Steps for getting your finances lean:
- Reduce wants and cancel/suspend unused subscriptions.
- Eat your freezer and pantry: Create a clear weekly food plan to help reduce spending or food waste. A good option here is to eat your freezer and pantry. Remember, just like a business, food sitting in your pantry and refrigerator is like cash sitting on the shelves. Consume this food first.
- Reduce debt payments: Call your creditors to get loan deferment assistance. This can include your car loan, credit cards, and personal loans. You can also ask for the interest to not accrue during this time. Getting these payments deferred or at least reduced is key if cash flow is tight or negative right now.
- Defer federal student loan interest and payments. The federal government is allowing people to defer their federal student loan payments for up to 6 months without interest accruing or penalties. But you have to apply! To get more info, click here
- File for Unemployment Insurance ASAP: If you’ve been laid off, apply for unemployment insurance now. These benefits are not only available to full-time employees affected by the crisis, but also part-time workers, the self-employed, and those working in the gig economy (think Uber, Lyft, etc.). You will need to apply through your state, so please visit your state’s unemployment website for more information.
CALL YOUR LANDLORD
Always best to have a conversation about what’s going on and what you’ve done personally to make things work. Here are some ideas for that conversation:
- Rent Check In: Since times are uncertain it can be helpful to touch base with your landlord even if you are going to pay rent this month. It’s just a good time to keep communication open incase something changes next month. It’s also a good time to ask if they have asked for mortgage deferral? Many banks are allowing people to defer their mortgages with no penalty for 3-6 months. This is the type of support they can pass down to their tenants. It’s a good time to remind each other that this is a partnership. To get more info, click here
- Partial Payment: Discuss making a partial payment if you can. Offering to pay half and then checking back in around the middle of the month. In times like these, something is still better than nothing.
- No Payment: Let me be clear, not providing any rent payment should be your last option. If this is where things are at, best to start talking with your landlord now.
CALIFORNIA STATEWIDE MORATORIUM ON RESIDENTIAL EVICTIONS
California Governor Gavin Newsom declared a statewide ban on evictions for residents that can not pay rent due to COVID-19. This moratorium is in effect through May 31, 2020. This effectively, has given tenants 60 days to figure out how to pay rent without threat of eviction. Tenants who can’t pay rent need to send a notice in writing within 7 days of their rent being due saying that they cannot pay rent due to the COVID-19 outbreak. In this scenario, your rent is not forgiven, it’s just expected to be paid back in a “timely manner”. Cities throughout California have also passed their own protections for renters, so make sure to check in with your city since it may provide more relief than this baseline California policy. To read more, click here
This stay on evictions provides some breathing room for you to cut your budget while waiting for your unemployment and stimulus check to come in. Remember, not all bills are created equal. Rent, utilities, and basic food are the most important in times like these. These need to be the priority and everything else comes second.
If you have other questions or need more specific help you can always book a FREE 30 minute call today
Stay safe and kind to each other
~ Tiffany Groode, Financial Coach
