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New COVID Relief Bill Covers up to 80% of Unpaid Rent

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New COVID Relief Bill Covers up to 80% of Unpaid Rent

Categories: Homes Planning Property Management Real Estate Residents

Published 01/26/2021

Photo by Jorge Maya on Unsplash

California plans to extend eviction protections through the end of June while using federal money to pay off up to 80% of unpaid rent owed by tenants. Gov. Gavin Newsom and the top two legislative leaders of California state announced Monday night.

The proposal, which must be approved by the state Legislature, would extend a state law scheduled to expire next Monday that prevents landlords from evicting tenants who could not pay their rent between March and August because of the coronavirus pandemic.

To be eligible for that protection, tenants must sign a declaration of hardship clarifying that they are affected by the pandemic and must pay at least 25% of their rent due between September 1st, 2020, and January 31st, 2021.

This new proposal would extend those protections until June 30th, 2021. But it would also use the $2.6 billion Congress recently approved for California to pay off some of that unpaid rent.

The state would pay landlords up to 80% of their unpaid rent — but only if landlords agree to forgive the remaining 20% and pledge not to evict tenants.

If landlords refuse that deal, the state will pay them 25% of their tenant's unpaid rent. That would ensure those tenants qualify for the state's eviction protections and avoid eviction until after June 30th.

The federal rent relief money would only be available to people who meet specific federal eligibility requirements, including household income 80% or less of the area median income. It would prioritize relief for households at 50% or less of the area median income and those that have been unemployed for at least three months. That would exempt some moderate to higher-income renters.

For more information and updates, please refer to the CAA website.

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