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14% of renting households are behind on payments. The average amount owed is $3,400.

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DISCLAIMER: As the COVID-19 public health situation evolves, new regulations are being continually issued. This page/story/information may not include the most recent information.

By: Al TompkinsMay 21, 2021 

https://www.poynter.org/reporting-editing/2021/14-of-renting-households-are-behind-on-payments-the-average-amount-owed-is-3400/ 

There is still a rental reckoning ahead and it may not be far off. CBS News says, “The trickle of evictions across the country could soon become a flood as renters owe $53 billion to landlords.”

CBS News continues:

Up (to) 40 million Americans are at risk of losing their homes, according to the Aspen Institute.

On average, Black renters are twice as likely as White renters to face evictions, according to the American Civil Liberties Union. …

One in seven tenants is behind on rent, according to the Census Bureau’s Household Pulse Survey.

The Centers for Disease Control and Prevention’s prohibition against evictions expires at the end of next month. Even before then, the moratorium may have legal headwinds. Federal courts have ruled the CDC overstepped its authority and a group of landlords announced this week that they may ask the U.S. Supreme Court to overturn the moratorium nationwide. Some states still forbid evictions during the pandemic.

The Eviction Lab at Princeton University says landlords have filed 342,000 eviction orders since the pandemic began.

In Dallas-Fort Worth, just as an example, 34,000 eviction orders have piled up. CBS News went inside Dallas’ eviction court, where 200 lawyers are working pro bono to represent 7,000 tenants facing eviction.

In Lee County, Florida (Ft. Myers), 34,000 people have filed for federal rent and utility assistance, meaning about one in 10 households there say they need help. In Milwaukee, the agency that is managing the rent assistance says it has been so swamped by applications that there is a backlog.

In California, where only 1% of the federal help has been doled out, there is a big roadblock. The Half Moon Bay Review explains that the terms of the California program say that the federal assistance will pay for 80% of the monthly rent, but that the landlord would have to eat 20% of the rental cost. In other words, the landlord will have to lower rent to keep from foreclosing. But the California program also offers to pay a big chunk of back rent.

U.S. News and World Report used data from National Equity Atlas and reported:

Alabama, Louisiana, Florida, Alaska and Georgia have the highest shares of renters with debt, each at 20% or more. On the opposite end of the spectrum, the states with the lowest percentages of households with rent debt are UtahMaineOhioIdaho and Kansas. Only 6% of renters in Utah and Maine are behind on rent, according to the data.

While California isn’t among the five states with the highest shares of households behind on rent, the state does have two metro areas — Riverside-San Bernardino-Ontario (22%) and Los Angeles-Long Beach-Santa Ana (16%) — with high debt percentages. Hawaii has the highest average rent debt per household, at $5,500, but only 8% of the state’s renters are behind, according to additional data provided by PolicyLink.

Overall, 12 states have rent debt shares under 10%. Fourteen states and Washington, D.C., have percentages of at least 15%. Maryland, where a tenants’ rights bill is awaiting the signature of Republican Gov. Larry Hogan, has 19% of households in rent debt.

Think about that. One in five renters in Maryland, Alabama, Louisiana, Florida, Alaska and Georgia are behind on their rent. As concerning as the overall numbers are, the figure was even higher late last summer.

You might be asking what happened to all that federal help that was supposed to go to people who were behind on their rent. Good question. CBS found 90% of the federal money is still bottled up in the government pipeline somewhere:

Texas has more than $1 billion in funding for rental assistance. More than 130,000 people have applied for the funds and over 16,000 have been approved. But so far, just over $112 million — less than 10% of the funds — has been dispersed to tenants in need, according to the Texas Department of Housing and Community Affairs.

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Michigan license number:   DM-0016282 Available to the public and licensed in Michigan.

Section 13(1)  When a licensee establishes a debt management plan for a debtor, the licensee may charge and receive an initial fee of $50.00

Section 13(2)  A licensee shall attempt to obtain consent to participate in a debt management plan from at least 51%, in number or dollar amount, of the debtor’s creditors within 90 days after establishing the debt management plan. If the required consent is not actually received by the licensee, the licensee shall provide notice to the debtor of the lack of required consent and the debtor may, at its option, close the account. If the debtor decides to close the account, any unexpended funds shall be returned to the debtor or disbursed as directed by the debtor.

Sec. 14. (1) A contract between a licensee and debtor shall include all of the following:

(a) Each creditor to which payments will be made and the amount owed each creditor. A licensee may rely on records of the debtor and other information available to it to determine the amount owed to a creditor.

(b) The total amount of the licensee’s charges.

(c) The beginning and termination dates of the contract.

(d) The principal amount and approximate interest charges of the debtor’s obligations to be paid under the debt management plan.

(e) The name and address of the licensee and of the debtor.

(f) Any other provisions or disclosures that the director determines are necessary for the protection of the debtor and the proper conduct of business by a licensee.

Sec. 18. (1) In addition to the fee described in section 13(1), a licensee may charge a reasonable fee for providing debt management services under a debt management plan. The fee under this subsection shall not exceed 15% of the amount of the debt to be liquidated during the express term of the plan.

(2) A licensee may offer a debtor the option to purchase credit reports or educational materials and products, and charge a fee to the debtor if the debtor elects to purchase any of those items from the licensee.  Fees charged under this subsection are not subject to the 15% limitation on fees described in subsection (1).

(3) Except for a cancellation described in subsection (4), in the event of cancellation of or default in the performance of the contract by the debtor before its successful completion, a licensee may collect $25.00 in addition to any fees and charges of the licensee previously received by the licensee. This $25.00 fee is not subject to the 15% limitation on fees and charges under subsection (1).

(4) A contract is in effect when it is signed by the licensee and the debtor and the debtor has made a payment of any amount to the licensee. The debtor has the right to cancel the contract until 12 midnight of the third business day after the first day the contract is in effect by delivering written notice of cancellation to the licensee. A cancellation described in this section is not subject to, and a licensee shall not collect, the fee described in subsection (3).

(5) If a debtor fails to make a payment of any amount to a licensee within 60 days after the date a payment is due under a contract, the licensee may, in its discretion, cancel the debt management contract if it determines that the plan is no longer suitable for the debtor, the debtor fails to affirmatively communicate to the licensee the debtor’s desire to continue the plan, or the creditors of the debtor refuse to continue accepting payments under the plan.

(6) A licensee shall not contract for, receive, or charge a debtor an amount greater than authorized by this act. A person that violates this subsection, except as the result of an inadvertent clerical or computer error, shall return to the debtor the amount of the payments received from or on behalf of the debtor and not distributed to creditors, and, as a penalty, an amount equal to the amount overcharged.

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