The Federal Housing Finance Agency (FHFA) is seeking public input on improving tenant protections that could affect millions of renters nationwide.
The agency is considering making tenant protections a requirement for properties with federally insured mortgages. FHFA wants to hear from tenants about problems they have had with their landlords, not just from owners and property managers.
Low-income renters can submit comments to FHFA through tenantcomment.org, a portal sponsored by a dozen fair housing, legal services, and tenants’ rights organizations.
The portal offers useful tips for submitting comments. FHFA is interested in both the challenges tenants face and solutions that tenants propose.
Some examples of tenant challenges include trouble finding affordable housing, steep rent hikes, working extra to afford rent, eviction notices, and poor living conditions.
Solutions can include caps on rent hikes, allowing only good cause evictions, banning source of income discrimination, having a tenant’s right to organize, and requiring fair and clear leases.
Landlords, corporate owners, and property managers will be sending in lots of comments opposed to new protections for tenants. It is important for low-income renters to balance the scales, and show how improving tenant protections will help them keep their homes.
FHFA oversees Fannie Mae and Freddie Mac, who insure mortgages used to finance new rental housing. More than 12 million renters in federally insured properties.
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Higher fees reduce eviction filings and judgments against renters
Jurisdictions that have higher fees when landlords file for eviction have lower eviction filing rates and fewer judgments against renters, according to research published in Housing Policy Debate.
The authors looked at the fees that courts charge landlords for filing evictions. They compared this information with data on the number of eviction filings, eviction judgments, and serial eviction filings in a sample of jurisdictions around the country.
Serial eviction filers are landlords who frequently file for eviction, often as a tool for rent collection instead of for lease violations.
The study found that eviction filing rates were lower in jurisdictions with higher filing fees. Eviction judgment rates against tenants were also lower when filing fees were high.
On the other hand, jurisdictions with lower filing fees had higher rates of serial eviction filings.
All of these effects were greater in majority-Black neighborhoods compared with majority-white neighborhoods.
The findings suggest that landlords are more reluctant to file for eviction when the process becomes more costly. Landlords are also less likely to use eviction to intimidate tenants when the fees are higher and they are less likely to win in court.
More renters could own homes if lenders consider rental payment history
Low-income renters, especially Black renters, have a better chance of buying a home if lenders consider rental payment history in addition to traditional credit scores.
An article by the Urban Institute looks at how policymakers can push mortgage lenders to widen homeownership opportunities for low- and moderate income renters.
Banks look at several things to determine if an applicant will be able to make mortgage payments, but they lean heavily on credit history. However, very few landlords report rental payments to the credit bureaus because it costs them time and money. If they report anything, it is usually missed payments or eviction filings.
Renters may have enough income to afford mortgage payments, but without a strong credit history they are often denied mortgages. Many more renters would qualify for mortgages if banks looked at their history of paying rent on time.
According to the brief, policymakers can push lenders to include rent payment history in a couple of ways:
- Incentivize rent reporting.
Landlords can receive benefits for adopting rent reporting, such as help with reporting fees, tax write-offs, or measures to make reporting easier. - Encourage or require lenders to accept “consumer-permissioned data.
This means that applicants can provide access to bank accounts or other financial information to prove they have made rent payments on time. Renters would then not have to rely on landlords to provide this information.
Making these changes will benefit Black renters the most, who have been disproportionately denied credit and homeownership opportunities through decades of redlining.
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