Already a client and need help determining your CARES Status? Click the button to the right.
Not a client quite yet? Keep reading below to learn more about the Federal CARES Act and how it might affect your property. You’ll also find our free affidavits and sample lender letter verbiage, should you need them.
Reminder: CARES ACT 30 Day Notice To Vacate
When it comes to the CARES Act, the question asked most frequently “Are we still required to give a 30-day notice to vacate before filing eviction in NC/SC/GA?”
The 30-day NTV will be a permanent requirement for our clients who are COVERED (have a federally-backed mortgage on the Property) unless/until:
- The Property is re-financed into a new mortgage that is NOT “federally backed” or the mortgage is paid off and the Property is owned “free and clear” OR
- The CARES Act is either revised or repealed under Congress after the mid-term election.
In regards to the CARES Act 30-Day Notice to Vacate, in late April (Please see below) HUD updated their CARES Act FAQ document, adding a question regarding 30-day Notices to Vacate for non-payment cases. Now there is a new Q25, where HUD confirms that the 30 Day Notice to Vacate requirement remains in effect for all properties that are “COVERED” under the CARES Act definitions. (see pg. 18 for Q25.)
What does this mean if you are a “Covered Property?”
(i.e. one with a ‘federally backed’ mortgage. Scroll below to learn more about covered properties)
It means that Sec. 4024(c) of the CARES Act will continue to require a 30 Day Notice to Vacate be sent to any resident who is behind in their payment of rent before you can submit an eviction case to the Court (NOTE: the 30-day NTV is not required to file for ‘other’ breach of lease cases, only non-payment ones.)
Going forward:
- You should not change your practice of providing a 30-day NTV to each non-paying tenant unless: (a) your Property’s mortgage loan type changes (due to a sale or a re-finance, in which case let us know via the form at the bottom of this page); or (b) HUD or some other Federal authority confirms that this 30 Day Notice to Vacate requirement has come to an end or is no longer applicable.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Coronovirus Response and Relief Supplemental Appropriations Act of 2021 provide “fast and direct economic assistance for American workers, families, and small businesses, and preserve jobs for American industries.” The CARES Act was signed into law on March 27, 2020. On August 6, 2020, the Federal Housing Finance Agency (FHFA – the parent entity for Fannie Mae and Freddie Mac) issued a press release announcing a new CARES Act-related mandate to increase awareness of tenant protections contained in the CARES Act. this 2.2 trillion economic stimulus bill includes a $300 billion one-time cash payment to individuals people who submit a tax return in America with the creation of the Paycheck protection program that provides forgivable loans to small businesses. Included in the CARES Act was a 120 – day moratorium, which prohibited certain property owners from filing non-payment of rent evictions, as well as collecting late fees. Updates will be posted in order – with the most recent first, below.
Covered Properties
For each property that DOES have that type of federally-backed financing, the CARES Act’s 120 Day late fee and eviction “moratorium” applied to the Property through July 25th. We call these “Covered Properties” and label them in our system so we can differentiate them from “Exempt Properties” (see below for more). Keep in mind that Section 8 Vouchers automatically convert a unit into a COVERED DWELLING under the CARES Act. So, 30 Day NTV must be sent to all voucher-holders.
If you know your Property is a “Covered Property” under the Act, then please complete the form below letting us know the name of your Property and its status as a “Covered Property,” so we may then note that in our system.
For Covered Properties, remember: the CARES Act also requires that Covered Properties must provide a 30 Day Notice to Vacate to every tenant who is behind on their rent before you can submit a case to the Court for eviction due to the non-payment. The expiration of the “eviction moratorium” on July 25th did NOT remove the obligation to send these 30 Day NTV notices, however – we are still required to collect these Notices from you as part of our case review process unless/until we have a change in the law or a binding clarification of this provision. So, if you’re a “Covered Property”, until further notice, please always send BOTH a 30 Day NTV notice and a “forbearance letter” (see below for more information) to us as part of all new case submissions.
Exempt Properties
For each property that does NOT have any “federally backed mortgage” financing, those properties are able to conduct business with the Courts based on their pre-pandemic notice requirements. However, in ALL States (including our 3 service States – NC/SC/GA), proving “exempt” status enables you to proceed with your cases in Court without an additional 30 day Notice to Vacate being sent to the tenant first. So, having proof that you are NOT a “covered property” is critical to our Team being able to approve your cases for filing. (NOTE FOR SC: a CARES Act certification/affidavit is still a required element and must be provided with each new case sent to the Courts for filing, so CARES status takes on even greater importance if you are one of these clients.)
So, in order to proceed for you, we need all clients to reach out to their lender/servicer and ask them to provide formal written confirmation of whether the property has a “federally backed multifamily mortgage loan” as defined in the CARES Act. If the Property is backed with a loan covered by the CARES Act, then we will note it in our records; but, if the Property is either not federally backed or is owned free and clear, then we will need the following information so that we can provide it as part of the CARES certification documentation that is now required:
For any Property that has a mortgage loan, but that mortgage is NOT ‘federally backed’, we need the following:
- For a Multi-Family Property: we need either a signed letter on letterhead (not an email) from the lender/servicer of the Loan that includes crucial information about the loan (see, e.g. the sample verbiage below); or as an alternative, an affidavit from a C-Suite Executive or General Counsel for the Company, OR a similar letter from the closing attorney would also suffice. [NOTE: If you provide a letter from someone other than the lender, you will need to adjust the language]. Regardless of who writes the letter, it must be: (a) on letterhead; (b) signed in ink or via e-signature, with the name and title of the person signing; and (c) it must include the property’s legal name and physical address.Sample Multi-Family Lender Letter:
Our Company is the [lender]/[servicer] of the loan(s) issued to or for the benefit of the Owner of the property known as [Property Name] – [Owner Legal Name] located at [Property address]. As such we are familiar with the nature, backing and issuance information for all such loan(s). We hereby confirm that there are no loan(s) in place for this Property that meet the definition of the term “Federally Backed Multifamily Mortgage” as defined by Sec. 4024(a)(5) of the Act.
- For a Single-Family Property: we need the Owner(s) (or their Property Management Company) to reach out to the lender/servicer of the mortgage and ask for confirmation from the lender of whether the property has a “federally backed mortgage loan” as defined in the CARES Act. If the Property is “Federally Backed” and therefore COVERED under the CARES Act, then we will note it in our records (and will expect to see a 30 day Notice to Vacate letter for any case filings on that Property); but, if the Property is either not federally backed or is owned free and clear, then we will need the following information so that we can provide it as part of the CARES certification documentation that is now required: 1) For Properties with a mortgage that is NOT “federally backed”: a signed letter on letterhead (not an email) from the lender/servicer of the Loan that includes crucial information about the loan (see, e.g. the sample verbiage below); or 2) For properties NOT subject to any mortgage, we’ll need the Owner to provide us with an Affidavit (see section below for details).Sample Single-Family Lender Letter:Our Company is the [lender]/[servicer] of the loan(s) issued to or for the benefit of the Owner: [Owner Legal Name(s)] of the property located at: [Property address] . As such we are familiar with the nature, backing and issuance information for all such loan(s). We hereby confirm that there are no loan(s) in place for this Property that meet the definition of the term “Federally Backed Mortgage” as defined by Sec. 4024(a)(4) of the CARES Act.
- For a Multi-Family Property: we need either a signed letter on letterhead (not an email) from the lender/servicer of the Loan that includes crucial information about the loan (see, e.g. the sample verbiage below); or as an alternative, an affidavit from a C-Suite Executive or General Counsel for the Company, OR a similar letter from the closing attorney would also suffice. [NOTE: If you provide a letter from someone other than the lender, you will need to adjust the language]. Regardless of who writes the letter, it must be: (a) on letterhead; (b) signed in ink or via e-signature, with the name and title of the person signing; and (c) it must include the property’s legal name and physical address.
- For any Property (MF or SF) that is NOT subject to any mortgage and is owned ‘Free and Clear’: we’ll need the Owner (or a C-Suite Executive or General Counsel for the Company, OR the closing attorney for the purchase of the Property) to provide us with an Affidavit confirming the Property has no mortgage loan, so that when we prepare and submit eviction cases relating to the Property, this Affidavit can be provided to the Court to prove the case can proceed without need for a 30 day Notice to Vacate being issued first.
Once you have that written confirmation, please upload it to our partners using the form below so that we can have all your properties properly entered into our system as soon as possible so we know whether we’ll be able to file an eviction case with the Court for you.
An important legal ruling was issued on May 15th by the Colorado Supreme Court: it confirmed that the CARES Act 30-day “Notice to Vacate” requirement remains in effect for all “Covered Properties.” In the Supreme Court’s opinion it said that the “Notice provision [of section 4024(c) of the CARES Act] did not include an expiration date” and that the Court could not “insert an expiration date where Congress omitted one.”
What does this mean? This means that owners and operators in Colorado will be required to continue the practice of giving residents in Covered Properties who fail to pay their rent a minimum of 30 days’ notice before seeking to evict. More importantly, though, the Court noted that this is the FOURTH State in which this same conclusion has been reached, stating that “Courts in Washington, Oklahoma and Connecticut (the only other jurisdictions that we are aware of to consider this issue) have come to the same conclusion.” Amid this mounting collection of adverse judicial rulings, then, it would be unwise to listen to anyone who tells you that the CARES Act 30 day NTV requirement somehow no longer applies. There is simply no judicial support for that conclusion, and there are now 4 different High Courts that say the opposite: unless your Property’s mortgage loan is NOT “Federally Backed”, then a 30 day Notice to Vacate is still mandatory.
[Note: In 2022, the National Apartment Association succeeded in getting certain members of Congress to try and correct the drafting error, and their Bill has been re-introduced and is still pending in the U.S. House of Representatives.]
DOES HJ RES 7 DO AWAY WITH THE CARES ACT?
Sorry to say that the ending of the declared COVID national emergency at the signing of HJ Res. 7 on April 10 does NOT kill the entire CARES Act. In fact, it only ends very narrow portions of the Act specifically tied to the ending of the declared national emergency (the Forbearance issues). The way-too-short text of HJ Res 7 does the entire country a disservice, in our opinion. It sounds fantastic but in reality, it does very little:
Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That, pursuant to section 202 of the National Emergencies Act (50 U.S.C. 1622), the national emergency declared by the finding of the President on March 13, 2020, in Proclamation 9994 (85 Fed. Reg. 15337) is hereby terminated.
To truly help us, it should have said, “the ‘Coronavirus Aid, Relief, and Economic Security Act’ (CARES ACT) is hereby repealed.” But it didn’t. And it doesn’t.
As more information becomes available, we will be sure to keep you posted.
DOES THE CARES ACT 30 DAY NOTICE TO VACATE REQUIREMENT STILL APPLY?
You may have seen that on Jan. 25th, 2023, the White House released their 19 page “Blueprint for a Renters’ Bill of Rights” (https://www.whitehouse.gov/
“The FHFA requires that tenants of multifamily properties with mortgages backed by Fannie Mae or Freddie Mac, who are subject to eviction for nonpayment of rent, must be given 30 days’ notice to vacate before the tenant can be required to leave the unit. This requirement applies to all Enterprise-backed multifamily properties, regardless of whether the loan is in forbearance.”
