The Property Owners’ Guide to Rental Assistance
Federal economic stimulus bills signed in December of 2020 and March of 2021 provide a total of over $46 billion in rental assistance funds to pay for accumulated rent not paid over the past year as well as current and/or future rent at risk of not being paid.
The National Rental Home Council (NRHC) has created this guide to understanding the federal government’s rental assistance program for property owners experiencing hardship as a result of missed rent. The information contained in this guide is meant to provide an overview for property owners of the important steps that should be undertaken to obtain rental assistance. This guide is intended to provide supplemental information for property owners and should not be relied on for specific advice concerning legal, tax, or accounting matters.
1. Assess your situation
Develop a detailed accounting of all funds that have not been received – on a monthly basis – since March 13, 2020, the date of the U.S. government’s initial national COVID emergency declaration. Guidelines provided by the U.S. Treasury Department allow for up to 12 months of financial assistance for rent in arrears plus an additional three months for current and/or future rent. Rental assistance must be used to cover any outstanding rent in arrears before it can be used for current and/or future rent.
Make sure the amounts you are claiming as owed are legitimate and allowable according to guidelines provided by both the U.S. Treasury Department and the state or local jurisdiction administering the rental assistance program based on the location of your property. In addition to rent payments, rental assistance programs may also cover utilities and other housing-related expense items. Amounts that you claim as owed should tie back to specific provisions of the lease document in force during the months when payments were not received.
The U.S. Treasury Department offers helpful information on Frequently Asked Questions.
NRHC has prepared a state-by-state list of web sites where you can locate further information concerning rental assistance. Note: the site listed for your state may contain information referring you to a more pertinent web page depending on how your state and local jurisdictions are administering rental assistance programs.
2. Communicate with your tenant
The U.S. Treasury Department designed their rental assistance program to ensure that both tenants and respective property owners benefitted from the financial relief provided. In most cases, a tenant will apply for rental assistance that will be paid directly to the property owner. Therefore, it is important (but not required) that you and your tenant are in agreement – prior to application – of any amounts owed. Property owners may also apply for assistance, but only if the tenant is not applying. Both parties may not apply. In situations where the property owner is applying, it is likely that the tenant will need to provide some kind of authorization or approval.
The program also includes relatively expansive criteria for determining eligibility. According to U.S. Treasury Department guidelines, your tenant will likely qualify for assistance if any individual in the household meets the following conditions:
- qualifies for unemployment or has experienced a reduction in household income, incurred significant costs, or experienced a financial hardship due to COVID-19;
- demonstrates a risk of experiencing homelessness or housing instability; and
- has a household income at or below 80 percent of the area median.
Additionally, any relief provided by the rental assistance program cannot be duplicative of any other federal rental assistance provided to the tenant.
As a property owner, you do have the option of not participating in the rental assistance program. However, NRHC strongly encourages and advises property owners to participate in the program.
Once you have documented your situation in terms of outstanding rental amounts, contact your tenant and make sure you both are in agreement about amounts owed and be prepared to address any discrepancies.
3. Organize supporting material
As part of the application process, you and your tenant will need to provide documentation supporting your claim. Items required for verification vary by state and jurisdiction, so make sure you know what you will need to provide. Also, be sure to review the list of items that your tenant will be required to submit. These items should be included on the web site of the state or jurisdiction administering the rental assistance program based on the location of your property.
4. Submit your application
Determine with your tenant who will be submitting the application. In granting rental assistance funds, priority will be given to applicants with income below 50% of the area median. Beyond this prioritization, funds will be disbursed largely on a first-come first-served basis, so it is important to make sure your application is submitted in a timely fashion.
5. Keep thorough records
Retain a record of interactions with all parties involved with your efforts to obtain rental assistance. Property owners should save copies of electronic and written correspondence with tenants, local government agencies, and any other parties related to rental assistance. Also, be sure to keep receipts and copies of deposits pertaining to amounts received as part of the rental assistance program. As a final step, it is good practice to inform your tenant once you have received funding from the rental assistance program.