Avoid Discrimination Claims When Offering Rent Repayment Plans

During the pandemic, many communities have been negotiating rent repayment plans to help residents who are struggling financially avoid eviction due to what may be only a temporary financial setback. The common practice of negotiating with residents on an individual basis results in different deals. While this variance in terms and concessions among residents of the same community may be nothing more than the reflection of the circumstances and dynamics of the particular negotiation, they may also be evidence of discrimination to the extent that residents in protected classes get less favorable terms.

For example, let’s say that John is a long-time resident who diligently pays rent on time and who happens to be white; Jane is a new resident who happens to be Black. John and Jane both pay rent late in December. The property manager charges Jane late fees but lets John slide. In the manager’s eyes, this is perfectly legitimate since Jane has yet to earn his trust the way John has. But this inconsistency in treatment is evidence of deliberate discrimination on the basis of race and sex that the community would have the burden of refuting before a court or administrative tribunal, if Jane accuses the community of discrimination.

Disparity in treatment, in violation of fair housing law, is an important concern when you’re renegotiating leases with residents who can’t pay rent due to COVID-19. Owners and managers who are negotiating rent relief agreements with residents need to be aware of these risks and guard against them. One way to do that is to establish a standard relief deal template offering the same terms to all residents who qualify.

With the upcoming expiration of the CDC’s and many states’ eviction moratoria, 2021 could see a surge in eviction filings—and related fair housing claims. For more information on how to navigate the eviction process in light of the pandemic, see the Coach’s January lesson, “How to Avoid Fair Housing Trouble When Evicting Residents,” available to subscribers here.