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  • Evan Shweky, Esq.

COVID Executive order empowers the CDC to institute sweeping eviction moratorium until end of 2020.

WHAT DOES THIS MEAN FOR LANDLORDS AND HOW DID THE CDC GET IN THE MIDDLE OF THE LANDLORD TENANT RELATIONSHIP?

Under the CARES Act, there was a moratorium on evictions for renters who participate in federal housing assistance programs or live in a property subject to a federally backed mortgage. Approximately 12 million renters fell within the purview of the CARES Act moratorium which expired at the end of July. President Trump recently issued an Executive Order which tasked the CDC with determining whether halting evictions would help slow the spread of COVID-19. Earlier this week, the CDC announced sweeping eviction protections in light of the health crisis. The CDC’s order is more expansive than the eviction moratorium that was part of the CARES Act. The current moratorium applies regardless of how a rental property was financed. Up to 40 million tenants will qualify for the latest moratorium on rental payments, an increase greater than 300% from those who qualified under the CARES Act rent moratorium.

The order does not relieve renters of the obligation to pay rent. In addition, the order does not prevent landlords from charging or collecting fees, penalties, or interest as a result of a tenant’s failure to pay rent on time. But what happens when they are unable to pay and can’t catch up?



The CDC rules require a renter to simply sign an affidavit with no accompanying documentation to prove an economic hardship. Being optimistic, we believe the majority of renters will not abuse the CDC’s eviction moratorium. However, with so much uncertainty about the future, it is not unreasonable to assume that many renters who are gainfully employed may submit the affidavit and look at the eviction moratorium as a kind of “savings account.” While they may genuinely intend to pay back the September to December rents owed in January, we know that unexpected expenses come up that force us to dig into our savings account all the time. Other renters may be nearing the end of their lease with the intention of moving out. They may decide to apply the rents accruing during the moratorium toward a security deposit and rental payments on a new place. True, most landlords require referrals from the previous landlord, but there are ways around that requirement.

They say, “There’s no such thing as free rent.” Let’s hope the majority of tenants understand that most landlords typically spend more than 50% of the monthly rental income toward the mortgage, taxes and expenses associated with the upkeep of a property. Let’s hope that our legislators know this as well and that the next government stimulus package addresses not just rental assistance but supports landlords’ in servicing their loans and providing their tenants with a safe place to live. Otherwise, this issue could have a devastating effect on the financial markets for both multifamily and single family rentals and renters and landlords will be impacted.


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Delarosa Asset Management LLC / T 646.596.5258 / info@delarosallc.com 

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