Buried deep within the text of the 2nd COVID relief bill passed in December and the American Rescue Plan signed this March, without any real fanfare or press among the relief payment checks, expanded unemployment benefits, and the expanded Child Tax Credit, is approved COVID emergency rental assistance and homeowner assistance. Combined, over $45 billion has been approved for renters and homeowners who have been negatively impacted economically by the COVID-19 pandemic. While there is currently a CDC eviction moratorium in place through the end of June, that won’t help impacted renters and homeowners get caught up on payments to avoid eviction after the moratorium ends. The funding is there for eligible citizens to use – and they should – so let’s review the basics.
COVID Rental Assistance Eligibility
In order to be eligible for rental assistance, renters generally have to meet the following criteria:
- Income for 2020 cannot exceed 80% of the renter’s area median income (AMI). States have been directed to prioritize applicants at 50% of AMI or below and those who have been out of work for 90 days or more, but each state might vary in how they prioritize the distribution of funds.
- At least 1 member of the household must have been eligible for for unemployment benefits, experienced a documented reduction in income, incurred significant costs, or experienced financial hardship, due to the pandemic (e.g. unemployment letter, etc.).
- The ability to demonstrate a risk of homelessness (e.g. a past due rent or utility notice).
States have different criteria on what documentation is required, but they are mostly tied to these 3 requirements.
Aside from renters, states may help with homeowner mortgage and insurance payments, as well as homeowner and renter utility payment (including broadband) assistance (there is a new federal broadband subsidy from the FCC as well), so everyone who meets the above criteria should see what funding is available in their state. It will vary by state and may even vary over time.
How Much Housing Assistance is Available?
There is not a defined amount of assistance available per state, as states have some discretion on how many months of assistance they are offering. As a general rule of thumb, from everything that I’ve seen from a number of states, 12 months of assistance seems to be the maximum, with the ability to apply for more later.
How & Where to Apply for Rental Assistance
This is where things get a bit murky and will require some homework on your part. There is no federal application process for renter or homeowner assistance, as funds have been distributed to states and localities, each with their own bureaucratic application process. Some states have already opened up their application process, while others have not. Rental assistance funds will not magically show up in your bank account or mailbox as they may have with relief payments – you need to apply to receive funds.
In some states both tenants or landlords can initiate the application process. Michigan, for example, highlights the following process:
The tenant or landlord can initiate the online application process. The tenant or landlord will need to enter the tenant’s name, address and email address, and the landlord’s email address. This will initiate emails to both the tenant and landlord for them to complete their portion of the application. Service agencies will communicate via email with the tenant and landlord if additional information is needed. The tenant and landlord will receive notice via email when the case is processed and how much funding has been approved.
In a few weeks, the application will be updated so the landlord can complete all “Tenant” and “Landlord” application fields and uploads, and the tenant will receive an email to confirm the application is true and correct.
I recommend starting the application process by checking out this database for your state. If you don’t see anything listed for your state or locality, head on over to your favorite search engine and search “[YOUR STATE] rental assistance” and “[YOUR CITY] rental assistance”. If you still can’t find anything, contact your state or city’s housing department directly for more info.
The key here, if you believe you are eligible, is to apply for funds ASAP. It’s been reported that the application process for many states and localities has been slow and cumbersome (likely a negative side effect of trying to avoid fraud), so it could take weeks or even months to receive funding. Something to be aware of, but don’t let that deter you from taking action. Additionally, you don’t want to be late to the party – if enough homeowners and renters apply before you do, you may miss out on receiving funding. The sooner you apply, the better your odds will be.
Who Gets the Rental Assistance Payment?
Again, no defined process here for every state, but I’ve seen a number of states outline the following:
- Renter applies for assistance.
- State/locality sends a verification form/paperwork to the landlord.
- If landlord verifies, they receive the payment. If the landlord does not verify, the renter receives the payment.
COVID Emergency Rental Assistance: Bottom Line
Now that you know COVID rental assistance funds are available, if you meet the criteria, there should be no shame or guilt in applying for and receiving funds. My best piece of advice is to research and apply for funding immediately to overcome the bureaucratic slowdown and depleted funding. You may want to let your landlord know that you have applied and ask them to confirm that they have submitted your paperwork, when prompted.
I’m curious to hear process and result anecdotes from those who have applied for funding already. Please share in the comments.