Stimulus Checks For Struggling Renters: How Federal Rental Assistance Works

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Even as the pandemic slammed into the US and almost decimated its economy, people feared the worst all around. Despite the stimulus checks, there was a growing fear that out-of-work homeowners would default en masse on their mortgages. At the same time, there was the possibility that millions of unemployed renters would be forced out into the streets.   

But the American housing market bounced back within a year. And people had the ultra-low mortgage rates to thank for it. But even as homeowners saw the value of their home witness a stupendous surge, renters were not so fortunate. 

The pandemic hammered the majority of renters working in industries. People in vulnerable industries like transport, retail, and hospitality, and holding down small businesses, were among the most affected. Most renters failed to earn a steady income for over a year and millions fell behind on their rent. The stimulus check money that they received in the initial round just about helped them bring food to the table. 

But the federal government stepped in with support for both homeowners and renters. And people received as much as $25,000 depending on where they lived. 

The federal government immediately assisted in the form of a moratorium on evicting renters. But it expired a year later. So renters with limited or no income who have already fallen back on their rent were naturally stressed. By the end of the first year in the middle of 202, around 6 million renters were behind in their payments. And in all, they owed around $20 billion in back rent according to housing experts. They warned that the nation was facing an eviction cliff at that stage. 

The federal administration moved in with Congress approving an emergency rental aid in two stages. $5 billion came in as part of the pandemic relief bill that was passed in December along with the second stimulus check. 

Another $216 billion came when President Biden signed the American Rescue Plan Act in March 2021, within weeks of coming to power. The distribution of the funds was handed over to the US Treasury.

An Unprecedented Amount Helped With Renters’ Stimulus Checks 

The Treasury (Emergency Rental Assistance) program injected an unprecedented amount. The funds were for any emergency rental assistance. This helped renters stay stably housed even after the year-long moratorium on eviction expired. This was revealed by the National Low-Income Housing Coalition. 

The website of the coalition maintained a list of around 400 programs for rental assistance. They were both open at that stage or were set to open soon. These programs enabled the money sanctioned by the federal authorities to reach renters across the country. 

The funding stimulus checks were available for renters who continued to struggle in paying their rent and their utility expenses as a result of the pandemic. For people who were in a bind at that stage due to their pending rent, this was the platform where they could seek immediate assistance. 

It was not easy initially to tap into the rental assistance stimuli checks. Subsequently, the application process for the payments was streamlined. This made sure that people who desperately needed the stimulus check were able to get the necessary relief. This was achieved without any additional anxiety-laden delays. 

To be eligible for the stimulus checks, at least a member of the household should have qualified for getting unemployment benefits. They must also be willing to submit in writing that the pandemic had forced a loss in income.

Potential beneficiaries will also have to prove that through a rent notice or a past-due utility, they face the risk of homelessness. There is also the income component. Those whose income had fallen below 80% of the median income of the community were eligible for the support. 

Renters Faced Numerous Barriers While Accessing The Federal Stimulus Checks

Renters desirous of contacting the appropriate local housing body could do so on the website of the National Low Housing Coalition. Qualifying renters received as much as eighteen months of assistance with rent. This assistance covered both past missed and future rent.

But many renters faced barriers as they tried to access federal aid. Subsequently, the Treasury Dept. made key changes that were aimed at ironing out the distribution process.  

The department instructed local agencies that were handling the rental assistance to directly offer the money to renters. Initially, the payment was going first to landlords. The Treasury also told local agencies to ensure that eviction of tenants for non-payment was stopped during the months that federal stimulus checks for rent were given.

Renters Get Tens Of Thousands In Stimulus Checks From Some States

In some states, programs to hand out rental relief stimulus checks are continuing. This has ensured that renters can continue staying at the homes. This has ensured that the Rental Assistance Program has succeeded in the primary goal of its welfare program. 

Millions of American families have been able to ensure a roof over their heads during the difficult period of the pandemic. 

The Emergency Rental Assistance under the Treasury Dept offered communities $47 billion during the COVID-19 pandemic and later. 

Around 10 million rental relief stimulus checks were distributed to families who were facing eviction. Research showed that the program immensely benefitted colored families and low-income renters. 

The rental assistance program has in the long run checked millions of evictions since the pandemic lockdown began in the first quarter of 2020.

To date, the Treasury Dept.’s rental assistance program has succeeded in providing rental assistance stimulus checks to 108 million families. The department has transferred funds from places where they were not spent and sent them to other state and local programs. Around $4.8 billion in rental assistance funds were relocated.

Even since the pandemic, around 180 state and local governments have developed eviction diversion programs or worked towards strengthening existing programs. 

New initiatives include providing long-term solutions to housing instability. This is an area where rent assistance alone does not help and falls short of the mark. 

Another area in need of attention is educating tenants on their rights. New tenant and landlord education programs have been developed.