REINCheck

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VO [00:00:06] You're listening to REINCheck with Andrea Rice, Contracts and Industry Specialist at REIN, where you get the latest member news and information delivered straight from the source, REIN MLS.

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Andrea Rice [00:00:20] Hello and welcome to REINCheck. I am your host, Andrea Rice, and today we are checking in with Property Managers Advisory Committee Legal Counsel Brandon Allred and 2021 Co-Chair Al Patel to talk about current laws regarding evictions and late notices. Brandon, Al, thank you so much for taking time out of your busy schedules to be here today.

Al Patel [00:00:43] Pleasure to be here.

Brandon Allred [00:00:44] Thank you. Nice to be here.

Andrea Rice [00:00:46] Thanks. And I know I've both had you on here before, and you always give great information, so we really appreciate that. And I wanted to check in with both of you to see where things currently stand when it comes to late notices and evictions. And Brandon, have there been any legal changes in how the notice is given or how the eviction process works? I know some things changed immediately after the pandemic and then they kind of sunsetted and what is the current process?

Brandon Allred [00:01:17] Yeah, great, great questions, and there have been a number of changes. You know, the good thing is that many of these should be familiar to landlords and property managers already because it's really just an extension of some changes that happened during COVID. But we've got a longer time period here than we originally thought we were doing. So the current changes are in effect through June 30 of 2022. So through the middle of this coming summer right now, and we'll see whether or not that changes in the coming months. But the biggest change and something that most of our property managers and landlords have probably noticed is that the old five-day notice is no longer a five-day notice. It is now a 14-day notice and that applies to all landlords across the board. So before you can initiate eviction proceedings, whether you're a small landlord owning fewer than four rental properties or a landlord owning more than four rental properties or more, you have to provide a 14-day notice of nonpayment of rent to tenants. If you are a larger landlord, meaning if you earn more than four rental units. And for purposes of determining whether you own more than four rental units, the code also looks at partial ownership through a partnership. So if, for example, you have an individual who owns 10 percent of a partnership and that partnership owns four rental units, then that individual is treated as owning four rental units for purposes of applying the statute. So if you've got that situation with what the code refers to a larger landlord, then they have a higher standard to meet before they can initiate eviction proceedings. So not only do they have to give the standard 14-day notice, they also have to offer to their tenants the option to enter into a payment plan for the past due rent that's owed. And the payment plan is for a period of time that is either six months or the remaining term under the lease. Whichever time period is shorter, or you can come up with some sort of alternate arrangement that is acceptable for both the tenant and the landlord. But you do have to offer to enter into the payment plan. If the tenant enters into the payment plan and then ceases to comply with that payment plan, at that point, you can give another 14-day notice and initiate eviction proceedings. You don't have to offer a second payment plan at that point. It's sort of a one-shot and done on the payment plan if you don't comply with it from the tenant perspective. But you do have to give that 14-day notice. There are also some requirements for all landlords under the rent relief program. But I think we've got that on our agenda for a little bit later in our conversation. So I'm going to hold off on those for the moment. But Andrea, that's a quick update on where we are with the latest.

Andrea Rice [00:04:54] Ok, and so the way you laid it out there that it actually, as it stands now, be in effect until this coming summer?

Brandon Allred [00:05:03] Yup June 30, 2022.

Andrea Rice [00:05:07] Ok, so I know there were a lot of concerns about evictions with the impact of COVID. And I'm just wondering, Al, have you seen an increase in the rate of evictions over the past year?

Al Patel [00:05:24] I wouldn't say an increase. It's pretty much steady the same amount of people I think because the there are rent relief programs in place. The payment option and things like that in place. We're not seeing the surge that everybody thought that we would see. That, you know, once the moratorium's lifted, all these landlords are going to evict their tenants. One, landlords don't ever want to evict tenants because nobody makes money that way and we don't want to put people out. But with the assistance and everything that's in place, we're really not seeing a huge surge that we all thought we might see.

Andrea Rice [00:06:15] Well, that's good, because I know that was a concern early on, you know, so you would say pretty much it's the same as in maybe pre-pandemic years?

Al Patel [00:06:25] Pretty much so. You know, it's like I say, the percentage of people that aren't going to pay and, you know, get evicted has pretty much stayed the same because the ones that truly were affected by COVID and could not pay rent are able to get the relief that they need.

Andrea Rice [00:06:48] Right, and you know, we've talked about the rent relief program a couple of times, kind of alluded to it. I was recently at a seminar where I heard that Virginia is actually one of the top states in the country for getting rent relief to those impacted by COVID. And Brandon, I think this would be a good time if you have any information that you could share about the Virginia rent relief program.

Brandon Allred [00:07:12] Yeah, absolutely. I'm happy to talk about that for a few minutes. And I mean, I think it's been a great program for Virginia in that it has helped stave off some of these evictions. And you know, it's provided meaningful tenant support. So the rent relief program is actually another prong of the test you have to meet as a landlord before you can pursue eviction proceedings. So you have to, you now have to, notify tenants of the existence of the rent relief program and actually offer to help them apply for rent relief or actually apply on their behalf, assuming the tenants will authorize you to do that and cooperate with you in doing that, for relief under the program before you can initiate eviction proceedings. And the way the program is set up, anybody who has an inability to make rent payments related to COVID-19 qualifies, and it's a self-certification process. So if you look at the standards, there is a whole laundry list of events that would qualify somebody for rent relief under the program. But the typical one is job loss related to the COVID-19 pandemic. And again, it's just a self-certification. The rent, the applicable rent, cannot exceed 150% of the fair market rent for that particular region. And the Department of Housing, the Virginia Department of Housing, is a schedule of fair market rent that everybody can go and look at. And then the gross income for the household seeking rent relief cannot exceed 80% of the area median income for the area in which they're located. And again, that's a standard that you can locate looking at the Department of Housing website. So if you've got a tenant who meets all of those criteria, they are eligible for rent relief under the program. It is 15 months of rent relief. That's the maximum amount available to each tenant, and you can apply for relief from rent in arrears all the way back to April 1st of 2020. And then you can actually get relief for up to three future months of rent on the application date. And the goal there, the goal of the program is to promote future housing stability. And they do that by giving you the flexibility to apply for those additional three months. So that's basically how the program works. Either the tenant can apply or the tenant can offer the landlord or rather authorize the landlord to apply on the tenant's behalf. Landlord has to offer the tenants the option to apply for relief under the program before they can initiate eviction proceedings. And there is actually a 45-day waiting period for landlords. So you have to give the application for rent relief 45 days to process before you can initiate eviction proceedings. And if the application has a process in 45 days or for some reason, the application is denied. At that point, you can go ahead and initiate eviction proceedings. So, while it's not required, what we're typically telling landlords to do, and I think what most property managers and landlords are doing is including the required notice about the Virginia rent relief program in their 14-day late payment notices if they have to send those out.

Andrea Rice [00:11:22] I guess one question I would have is it sounds like before any eviction can take place, the individual would have to apply for the rent relief program. So how does that work if the person if say you need to evict someone not based on nonpayment or if it's a nonpayment but it's not COVID related?

Brandon Allred [00:11:43] Yes. Great, great question. So if the tenant is not eligible for the rent relief program or the tenant flat out refuses to apply. Because you could have tenants who either won't do it themselves or won't authorize the landlord to do it on their behalf. Then you do not have to apply for the rent relief program. You do not have to wait 45 days. You can just continue with eviction proceedings. And to your second point, if we're talking about a situation where the landlord needs to terminate a lease for some reason other than nonpayment of rent, so if a tenant is engaged in criminal conduct or some sort of dangerous activity that is tortuous in nature and is endangering other tenants or the community at large, then you don't have to comply with that. You can proceed to eviction just like normal. So these only, and when I say normal, I mean in pre-COVID times. So these additional COVID protections really only apply to the nonpayment of rent.

Andrea Rice [00:12:58] OK. Yeah, that's a lot of great information, and Al, you know, as a property manager, have you had any direct experience with the rent relief program that you can share with us?

Al Patel [00:13:10] Yeah, I've had several of my tenants apply and get approved. As a company also, you know, we've had several tenants apply. It's been a great program. Most of the approval is fairly quickly. Sometimes application get stuck into whatever limbo for a while and it takes a while. But for the most part, it is, as Brandon said, most of this is self-certification. So there's really not a whole lot of documentation all that's required. So it's an easy process. Most people that, at least in my experience, most people have gotten approved. Talking to some other property managers, you know, they are experiencing the same thing. It's not that complicated of a process. The communication has been a little challenging, but that will change because as of December 1st, the place that we used to go to apply has changed. It's going to be a new place. The Department of Housing is actually going to be taking over this program, so they'll have a web portal that both landlords and tenants can log in. And it's saying that we're going to have better communication. So I see the program just improving.

Andrea Rice [00:14:52] That's great, and, you know, I was a little concerned when Brandon was saying, you know, you have they have up to 45 days. But from listening to you, they don't typically take that long to get back to you.

Al Patel [00:15:02] Yeah, most of them don't. Most get approved in a couple of weeks. Some take a little longer. But yeah, usually within 45 days. Most of them get approved.

Andrea Rice [00:15:15] OK, so that's how the process works as far as the late notice. How you have to apply through the rent relief program. But what do you do if you have a situation where you give notice, you go through the eviction process, and the tenant refuses to vacate the property? Has that ever happened? And if so, what are you to do at that point?

Brandon Allred [00:15:41] Well, I mean, I think there really hasn't been a whole lot of change on this from pre-COVID days. At that point, you are initiating eviction proceedings as you typically would, which means you are going to court and you're filing an action for unlawful detainer and you are, you know, obtaining a court order and you're seeking assistance from the sheriff's office to actually evict somebody. So, you know, there are some additional hoops that you have to jump through certainly given all of the COVID protections. But the actual process, once you get through all of those protections, is very much what you're used to seeing.

Andrea Rice [00:16:32] Great and, you know, are there any tips or last thoughts that you would like to add? Anything maybe that we missed about the notice or the eviction process in general that would be important to know?

Brandon Allred [00:16:47] I think the one caveat I would add is that self-help is never a good option in those situations, particularly where you've got a tenant that remains in possession. Just despite an order the sheriff's office is always going to be the answer as frustrating as it may be.

Andrea Rice [00:17:13] Right, good advice. Al, do you have anything else to add?

Al Patel [00:17:17] No, I think Brandon covered all.

Andrea Rice [00:17:20] All right, well, thank you, Brandon and Al. That was a lot of great information. And I know that no one enjoys the eviction process, but hopefully, for those of you listening, if you ever find yourself faced with evicting a tenant, you now have a little bit more information. I hope you enjoyed this episode of REINCheck, and if you missed any of the previous episodes, I do invite you to go to REINMLS.com/podcast to take a listen. And if you have not done so already, make sure you subscribe to REINCheck so you can get new episodes delivered directly to you when they are released. Thank you, and have a great rest of your day.

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VO [00:17:57] You've been listening to REINCheck with Andrea Rice. Stay in the know from those who know. Delivered straight from the source, REIN MLS.

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