Realtors® and their clients are understandably concerned about the rapidly evolving situation regarding the current COVID-19 virus outbreak. It is more important than ever for professionals to provide expert service that is tailored to each individual client and specific transaction. 

Property managers should prioritize repairs and inspections to limit unnecessary exposure while still complying with the terms of the lease. Leasing agents and property managers are encouraged to ensure their clients are aware that rent payments may be late.

 

It is possible tenants may experience income loss. In accordance with the March 16, 2020 Virginia Supreme Court Order, landlord-tenant cases are continued for the foreseeable future, which means that landlord remedies for evictions and damages through the courts are temporarily unavailable. Most area court clerks’ offices are processing new filings, but hearings are currently not being held. Property managers are encouraged to discuss the possibility of payment extensions and repayment plans with their landlord clients and tenants.

 

Remember, if the tenant fails to vacate and the landlord does not move to evict (or the parties are unable agree to an extension) the tenancy may become a de facto month-to-month tenancy. If you are going to accept rent and/or occupancy during this period, but want to retain the ability to pursue damages or eviction after normal court operations resume, consider delivering reservation of rights notices.

 

Landlords may also encounter tenants engaged in criminal activity posing a threat to health and safety. The best practice is to alert the authorities if they have not been notified of the unlawful conduct. Under the VRLTA Lease (“Lease”), the landlord may terminate the tenancy if an immediate threat exists that materially affects the health or safety of the landlord or other tenants. The landlord may give the tenant Notice of termination requiring the tenant to vacate within 72 hours of the date of such Notice. If the tenant refuses to vacate, the landlord should contact an attorney to discuss available options. According to Fairfax County General District Court, no Writs of Eviction or Writs of Possession will be issued prior to April 30, 2020 and all new unlawful detainer summonses shall be scheduled for a hearing no earlier than June 15, 2020. Emergency motions in which relief is necessary to prevent an imminent and substantial change in circumstances can be filed and will be heard daily. Check with your local General District Court for specific filing procedures.

 

The March 16, 2020 Virginia Supreme Court Order does not impact the early termination rights afforded to victims of (i) family abuse, (ii) sexual abuse or (iii) other criminal sexual assault under existing Virginia law. Under certain circumstances, tenants who satisfy §55.1-1236 may terminate their obligations under the Lease by providing the landlord with a copy of the order of protection or conviction order and serving written Notice that the tenant victim is terminating their rights and responsibilities under the Lease effective 30 days after the first date on which the next rental payment is due. While the offending co-tenant remains responsible for the Lease, the landlord may terminate the Lease if the perpetrator is the last remaining tenant.

 

If there are tenants in a property going back on the market for sale or lease, be prepared for push-back when scheduling showings. Under the VRLTA Lease, a tenant’s refusal to provide access is only a breach of the lease if the refusal is unreasonable. Manage your client’s expectations and encourage them to be patient and understanding of the tenant’s concerns. Given the current market uncertainty, keeping a paying tenant in place on a month-to-month basis by written addendum may be preferable to seeking a new tenant or buyer.

 

The Federal Housing Finance Agency (FHFA) also announced on March 23, 2020 that to support renters and owners of multifamily properties, Fannie Mae and Freddie Mac will offer multifamily property owners mortgage forbearance with the condition that they suspend all evictions for renters unable to pay rent due to the impact of coronavirus. The forbearance is available to all multifamily properties with an Enterprise-backed performing multifamily mortgage negatively affected by the COVID-19 emergency. Check FHFA’s website for more details.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act also establishes a 120-day moratorium (beginning March 27, 2020) on eviction filings for nonpayment of rent on properties “insured, guaranteed, supplemented, protected, or assisted in any way by HUD, Fannie Mae, Freddie Mac, the rural housing voucher program, covered by the Violence Against Women Act of 1994.” (https://www.nar.realtor/political-advocacy/coronavirus-aid-relief-and-economic-security-act). Check with your lender/mortgage servicer to determine if your property is covered by the CARES Act.

 

By keeping calm, observing best practices, communicating openly and honestly with clients and each other, and preparing for contingencies, Realtors® can protect their clients’ interest and uphold the highest standards of professionalism.

 

NVAR is open and online for business, so please direct any specific questions or concerns to the Legal Hotline.