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Coronavirus Rent Relief Programs

By Gary Smith
06/23/2020
Coronavirus Rent Relief Programs

Landlords may be eligible for financial relief to cover rent shortfalls in Chicago. Many Cook County residents have lost their jobs, either permanently or temporarily, during the COVID-19 pandemic, which is having a trickle-down effect on their ability to pay rent.

What Can Landlords do to Get Relief

In mid-March, when the shelter-in-place order essentially closed restaurants, hotels, retail and entertainment businesses, many of those workers were either furloughed or laid off entirely. And the situation for many businesses in those sectors has not improved enough to bring on additional employees, leaving many still on unemployment, if they were eligible for that in the first place.

This leaves landlords in a situation where they have mortgages due on the property with a tenant who might be asking them for some rent relief due to the tenant’s job situation.

There are some options for landlords, which include:

  • Encouraging tenants to apply for rent support from nonprofit or government agencies. Many Chicago-area nonprofits, including The Chicago Community Trust and United Way, have special COVID-response funds available to provide rent support. The City of Chicago is also offering a Rental Assistance Program, which provides COVID-related relief for renters at risk of homelessness due to the temporary economic crisis beyond their control and who would otherwise be able to meet lease obligations.
  • Allowing partial payments or forgoing a month’s rent. First, if they are allowing flexibility in paying rent, they should put together a lease amendment that outlines the deferment or payment plan. Second, Cook County Assessor Fritz Kaegi announced that his office will be reassessing properties across Cook County as markets and property values have been substantially impacted by the pandemic. In fact, landlords who lose rental income will be able to contest the next property tax bill on the basis of depreciated rental income.
  • Taking advantage of programs that assist landlords who support their tenants with discounts, deferments, or forgiveness of rent. There are public/private partnerships, such as the Chicago Small Business Resiliency Loan Fund or the federal Small Business Administration.
  • Filing a claim on commercial general liability coverage for business interruption.
  • Checking with the bank to see if they’re allowing for delayed mortgage payments or suspension. Fannie Mae, Freddie Mac, and the FHA have all created emergency measures to allow for temporarily delayed payments or payment suspension for 12 months. Some banks are also deferring payments without penalty and extending the life of the loan.