In October 2020, just before one of the deadliest surges of COVID-19, reports showed that as many as 34 million people in the US were at risk of eviction as state orders were set to expire. What state orders? Well, in the spring of 2020, numerous governors implemented eviction moratoriums to prevent landlords from evicting tenants during the onset of the COVID-19 pandemic.
What this meant was that state law explicitly prohibited landlords from evicting tenants if they couldn’t pay rent. And, that protection lasted for well over a year! However, as the pandemic has slowed down across the country, various states have let those moratoriums end. In California, for example, the order expired on September 30, 2021.
However, each state’s rules were a bit different and there are other ways in which you can protect yourself if you’re still having trouble paying rent. For example, can you use your security deposit for rent during COVID-19? It depends on a few factors and where you live. Let’s explore that!
Which States Are Offering COVID-19 Financial Aid to Tenants?
We’ll start off by saying that if you are experiencing immediate financial distress, the US Department of Treasury has a valid notice on their website that states the following: “Renters and landlords can find out what emergency rental assistance covers, how it works, and who’s eligible on the interagency housing portal hosted by the Consumer Financial Protection Bureau (CFPB).”
This emergency help for families getting evicted or for tenants simply needing financial aid should be the first place you look if you believe that you are about to get evicted. Then, we’d suggest visiting your state’s housing department as well to check the rules and regulations that are currently active.
On the Texas Department of Housing & Community Affairs website, for example, it mentions that there are funds available to state residents looking for COVID-19 rent relief (find out more about that here). The California Department of Housing and Community Development offers similar guidance, and so do many other states. So, we suggest checking out the Department of Treasury guidelines first and then searching for state-specific information depending on where you live.
What About Tenants Who Didn’t Pay Rent During COVID-19?
Again, this all varies largely state by state, but since we’re in California, let’s take California as an example. In California, renter protection was initiated in the spring of 2020. To avoid eviction, renters experiencing COVID-19-related distress could pay just 25% of their rent during the period from September 1, 2020 to January 31, 2021.
This was all part of SB-91, which protected tenants through June of last year as long as they paid the 25% minimum due. However, SB-91 also stated that your landlord can’t use your security deposit to pay for rent due unless you agreed to that.
So, can you use your security deposit to pay for rent during COVID-19? Yeah, if you agree to that with your landlord! However, they aren’t allowed to automatically apply that security deposit amount to the total that you owe. This is important to understand because you likely want that security deposit back when you move out, right? Make sure that if your landlord is trying to tell you they’re going to apply the security deposit to your total balance that you’re a) okay with that and b) that you formally approve of that in writing.
While we’re on the subject, it’s important to note that this isn’t something that’s California-specific. Take Connecticut, for example. The rule is pretty much the same. Their state executive order says: “If a tenant has paid a security deposit of more than one month’s rent, a landlord may, upon tenant’s request, apply the amount of the security deposit that exceeds one month’s rent to pay a portion of the rent due for April, May, or June, 2020.”
What Other Types of Financial Assistance Are Available to Renters?
If we continue focusing on California for this example (remember, other states have their own rules, and while those can vary greatly, many are similar to California’s), you’ll see that there are still COVID-19 tenant assistance programs for those experiencing financial difficulties due to the pandemic.
For example, the State of California has agreed to pay 100% of unpaid rent for low-income residents of the state. As a renter, you have to apply for this assistance yourself (learn more about the program here), but some of the requirements include:
- Being below 80% of the Area Median Income
- Experiencing or having experienced financial impacts related to COVID-19
- Being at risk of homelessness or housing instability
Other states have implemented similar programs, so it’s worth checking out what’s available to you at a state level.
How to Save Money for Rent During COVID-19
If you’re struggling to save money for rent during the ongoing economic and health crisis, you’re not alone! Millions of others are in the same boat, and the good news is that you have options available to you. If you don’t qualify for any of your state’s renter’s assistance programs, then we suggest getting in touch with your bank to ask about their financial aid options.
Other ways of saving money for rent during the pandemic include:
- Checking out payday loan apps where you can access emergency cash if you need it
- Selling things online (whether that’s goods or services) so that you can earn extra money
- Starting a side hustle (that, hey, could turn into a really lucrative full-time job!)
- Ensuring that your credit cards and debit card are optimized to help you earn cashback
While we know that simple cashback offers won’t help you pay for your entire rent, we do believe that little things can add up. It’s why our Cheese Debit Card comes with a hefty cashback offer on top of a 3% deposit bonus.
We believe that your money should work for you and that you deserve to earn rewards when you spend. We also believe that you deserve to have all of the financial tools you need at your disposal to build wealth and save for your future. It’s why we’re introducing a new credit builder feature!
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