Moratorium on COVID-Related Residential Evictions Extended Through End of 2020

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New York Gov. Andrew Cuomo has extended the Tenant Safe Harbor Act through Jan. 1, 2021 to protect residential tenants suffering financial hardship “as we recover from this crisis." In contrast, the hardship for owners, who remain liable for taxes, mortgage, insurance, repairs and other carrying costs, is becoming increasingly severe.

At this stage, the moratorium period stands at essentially 10 months – March 7, 2020 through Jan. 1, 2021. A court can never use unpaid rent accruing during this period as the basis for a non-payment eviction of a financially-burdened tenant. A court, however, may render a monetary judgment for the rent due. As such, tenants technically remain liable for unpaid rent accruing during the moratorium. Unfortunately for owners, as these rent arrears continue to grow, actual collection of the debts becomes increasingly unlikely.

In order to determine whether a tenant is deemed to have suffered financial hardship during the COVID Period, a court is required to consider, among other relevant factors: (i) the tenant’s income prior to the COVID Period, (ii) the tenant’s income during the COVID Period, (iii) the tenant’s liquid assets, and (iv) the tenant’s eligibility for, and receipt of, cash assistance, supplemental nutrition assistance program, supplemental security income, the New York State disability program, the home energy assistance program, or unemployment insurance or benefits under state or federal law. The fairly broad and non-exclusive nature of these factors practically ensures that most tenants alleging this defense will qualify.

Meanwhile the moratorium on COVID-related commercial evictions and foreclosures has been extended through October 20, 2020, which has incentivized renegotiations of commercial lease terms.

New York State’s Housing Stability and Tenant Protection Act of 2019, the more recent Tenant Safe Harbor Act and the various Executive Orders issued by the Governor, continue to transform the way landlords deal with defaulting tenants. Each situation is unique and landlords are advised to consult with a knowledgeable attorney, capable of navigating these complex and evolving enforcement requirements, and to discuss options and resources that can be utilized to assist in obtaining possession of their property and collecting past due rent.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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