Tenants and landlords both worried about COVID-19 financial problems
Q: I’m a tenant in Ottawa. After working at my job for many years, I was just laid off because of COVID -19. I have one pay cheque coming, but after that I see no chance of earning more money until the shutdown ends. I’m worried that I will be evicted. Should I be?
Q: I’m a small landlord in Ottawa, and my income from my regular day job has dropped dramatically. On April 1, my next mortgage payment is due, and my superintendent will need to be paid. I know a number of my tenants have been laid off, or have had their contract work drop to nothing, and so they won’t have any money to pay their rent. I’m struggling to find cleaning supplies to buy for the building, as well as struggling to pay my employees and to pay my mortgage. If the rent doesn’t come in, how am I going to pay what it costs to run my building ?
A: No one will be evicted because they cannot pay their rent promptly because of losing their income due to COVID -19.
Landlords realize that many tenants have lost their incomes and will have trouble paying their April rent in full and on time. In Ontario, landlords typically enforce rent payments by issuing a notice of termination of a tenancy, and then following a process at the Landlord and Tenant Board. Tenants get many chances to pay their rent and keep their tenancies.
To comply with the social distancing advice, most landlords have closed their offices. In those cases, tenants should pay their rent by electronic means or by postdated cheques.
As well, tenants, or anyone whose income has collapsed due to the shutdown, should apply for the financial help the governments are making available to make sure people can buy groceries and other necessities and pay their rent. That includes applying for Employment Insurance (EI) if you have been laid off and qualify for EI.
If a person does not qualify for EI but has lost their income due to COVID-19, they should apply for the new Canada Emergency Response Benefit (CERB), which is to be administered by the Canada Revenue Agency.
Landlords also need to be responsible. Ideally, they will reach out to tenants to make any needed deferral arrangements on a case-by-case basis. It is clear that some tenants will not be able to pay their rent on April
1, at least not in full. For people who cannot pay, landlords should welcome a partial rent payment on April 1. They should welcome a promise to pay as soon as each tenant’s first COVID-19 support cheque comes in.
The banks will not begin foreclosure proceedings if the April 1 mortgage payment is short. Your bank will appreciate a partial mortgage payment. If you pay the interest and defer the principal, that would generally fall within the mortgage deferral plan the Big 6 banks announced. The
City of Ottawa is also providing interim help to many landlords by allowing a deferral of their property tax instalments and their water bills.
However, just like the rent, those payments will need to be made after the grace period, and landlords should make those payments after paying their employees and trades.
PLEASE SEND QUESTIONS FOR RENTAL EXPERTS OR SUGGESTIONS FOR TOPICS TO: RENTAL GUIDE, C/O ADVERTISING FEATURES, OTTAWA CITIZEN, 1101 BAXTER RD., OTTAWA, K2C 3M4 OR BY EMAIL TO: ADVERTISINGFEATURES@POSTMEDIA.COM. SELECTED QUESTIONS WILL BE ANSWERED IN FUTURE COLUMNS. FOR IMMEDIATE ASSISTANCE CALL THE LANDLORD TENANT BOARD AT 1-888-332-3234.