Can’t Pay Rent? Experts Say These 5 Steps May Help You Avoid Eviction
Even though the rental market is cooling, rent is still high and many renters know the familiar dread when the first of the month is coming and they know they can’t cover the rent.
But now’s not the time to bury your head in the sand.
By exercising your negotiation muscle, you may be able to strike a deal with your landlord that prevents the worst-case scenario: getting kicked out of your home. And in those crunch times, it’s always a good idea to look at your budgeting and spending to see where you could find a little extra cash to put toward rent.
Behind on Your Monthly Rent? You’re Not Alone
Unfortunately, being unable to pay rent is an all too familiar scenario for far too many Americans. More than 1 in 8 people are behind on rent, according to a recent analysis by LendingTree.
A late rent payment doesn’t just affect renters who face the eviction process. As the Washington Post details, overdue monthly rent has a ripple effect that eventually impacts both the landlord directly and the economy as a whole.
This outside economic impact is why the federal government subsidizes rent assistance programs and makes affordable housing and federal rental assistance a top policy and budgeting priority.
5 Steps to Negotiating a Deal With Your Landlord If You Can’t Pay Rent
When you think you can’t pay rent for the upcoming month, it’s best to talk to your landlord sooner rather than later.
Here’s what you should do.
Step 1: First, Know Your Rights
Matt Koz, finance director for the Tenant Resource Center in Madison, Wisconsin, recommends that renters do their due diligence to research the eviction laws and eviction protections in their area.
The federal eviction moratorium ended in 2021, but some states, cities and counties passed their own laws protecting tenants and granting them new rights.
Being educated about the tenant laws in your state doesn’t just give peace of mind about whether your landlord can evict you during a crisis. It can also help you decide how to best proceed when reaching out to your landlord.
For example, Koz said there could be laws where you live that make it disadvantageous to pay partial rent, if you were thinking of suggesting that to your landlord.
“In some cases, it may be better not to offer terms and wait to see what recourse is available to you,” he said.
There are also two federal protections for renters that many people don’t know about. According to the Consumer Financial Protection Bureau, if you or your landlord receive federal subsidies, there are tenant protections. This could mean that you live in a building with five or more units that has a federally insured mortgage. Or if you or your landlord gets a tenant-based HUD voucher, you probably have the right for a 30-day eviction notice.
The U.S. Department of Housing and Urban Development provides crucial housing information for each state through its website.
Step 2: Approach Your Landlord With Empathy
You may just think of your landlord as a faceless entity that takes the biggest single chunk of your money every month. But a little kindness can go a long way. Before panicking, look at your lease so you know the terms of rent, late fees, eviction notices, etc. and then communicate with your landlord openly.
“Lead with empathy,” advises Michael Thomas, an accredited financial counselor and lecturer at the University of Georgia. “It’s very easy to become self-absorbed when we’re experiencing a financial shock.”
He says taking the time to ask how your landlord is doing and working to establish a relationship can make them more willing to work with you. Understanding where each person is coming from can lead to a resolution that’s best for both parties.
Step 3: Provide Realistic Solutions
Offering up a solution to your situation can show your willingness to work with your landlord.
You might propose to make a partial payment with a promise to pay the remainder of the rent by a certain date. If you don’t know when you’d be able to make the remaining payment, Koz said it’s reasonable to make an agreement based upon a specific occurrence.
For example, you might ask if you can pay the remainder once your kids’ are back in school and you can pick up more hours at work.
Instead of suggesting a partial payment, you could ask to skip paying for one month and spread that payment over the remainder of your lease if you think you’ll be able to pay the following month.
Another option: Ask your landlord to apply your security deposit to the upcoming rent payment, agreeing to replace it at a later date. Or if you paid your last month’s rent upfront when you first signed your lease, you could ask to apply that money to next month’s rent.
When trying to come up with a rent solution for the upcoming month, make sure you’re not creating a worse financial situation for yourself later on.
Something else you might consider is bartering. For example, you could agree to do landscape work for your landlord’s properties in exchange for a break on rent.
When trying to strike a deal, Thomas suggests coming up with at least three plausible solutions that work for your budget.
“Go with your best-case scenario first,” he said.
If your landlord won’t agree to that, ask for their input on mitigating the situation before presenting your other options.
Step 4: Get Agreements in Writing
If you and your landlord are able to agree on an alternative plan for paying rent, make sure to get that deal in writing.
“If [your landlord] were to come back and say we didn’t agree to that, [you can say]: Actually we did and here’s proof,” said Pamela Capalad, a New York-based certified financial planner and founder of Brunch and Budget.
Putting things in writing also helps eliminate misinterpretations of your agreement, she said.
However, when signing a lease addendum or other paperwork, don’t rush into a contract with terms you don’t understand.
“If you’re not sure what you’re signing, you can always try to contact a tenants rights organization or an attorney,” Koz said. “Whatever you sign is something that you’re held to. If you don’t meet the terms of that agreement, you’re back where you started.”
Local legal aid organizations or pro bono lawyers may provide free counsel to individuals with lower incomes.
Step 5: Don’t Go (Further) into Debt
You may experience shame over not paying rent or fear over potentially losing your home, but try not to let that lead you to making drastic decisions.
“The thing I would recommend, if you can avoid it, is to not take out loans to pay rent,” Capalad said.
However, you could consider credit counseling or consolidating your debt. Find nonprofit debt consolidation companies through the National Foundation for Credit Counseling.
It can be comforting to put things in perspective and realize you’re not the only one who can’t pay your rent right now, she said.
8 Actions to Take If You Can’t Pay Rent
If your landlord won’t budge on requiring you to pay your rent in full, here are a few ideas for coming up with the money.
1. Seek Emergency Rental Assistance
Look into local housing assistance or eviction prevention programs for emergency funding to help keep you in your home.
The United Way’s 211 network or The Salvation Army rent assistance program is a great way to connect to resources in your community through a local organization. Other charities, like Modest Needs, may also be able to help. Your landlord may even know of housing assistance options in your area.
Check out the National Council of State Housing Agencies for more information on state and local programs, or contact the local housing authority. The U.S. Department of Agriculture also provides rental assistance for some low-income rural housing, and the Department of Housing and Urban Development (HUD) has a list of rent assistance organizations and legal resources.
There is also low-income rental assistance still available from 2021’s American Rescue Plan Act. You can see where it is available in this National Low Income Housing Coalition dashboard.
2. Bring In a Roommate to Help With Rent Payments
If you can find a good roommate, you can split housing expenses and lower your financial obligation. Just make sure you properly vet the potential roommate and your landlord approves of the new tenant.
Subleasing your place could be another route to take, provided your landlord allows it and you have somewhere else you can crash in the meantime.
3. Sell Something to Cover Rent
Make some extra dough by selling things you don’t regularly use. Put that money toward the rent.
Wondering what to sell? We’re glad you asked. Vintage china, gold jewelry, ’90s collectibles or your old vinyl record collection can all bring in some serious cash.
Check out these websites for selling things online when you’re ready to list.
4. Get Another Gig to Help with Paying Rent
Get money for rent by securing a second source of income.
Consider a side hustle, like a food delivery driver, pet sitter, or even a freelance writer where you’re paid based on how much work you take on. These jobs often pay faster than traditional jobs that run on a biweekly schedule.
5. Trim Utility Bills to Provide Some Rent Relief
Take a closer look at other expenses like utility bills and decide if there’s a particular cost that’s eating into your ability to pay rent this month.
There are several local programs that help with utility costs, or you can explore assistance programs through the federal government, such as the Low Income Home Energy Assistance Program.
If you struggle with seasonal surges in utility costs, use level billing to create a more predictable utility bill.
6. Apply to Defer Other Debt Payments Due to Financial Hardship
Once the grace period on student loans has expired, you may find your bank account running on empty. You can apply for a deferment due to financial hardship or submit pay stubs to see if you’re eligible for an income-driven payment plan.
7. Consider Relocating to More Affordable Housing
Maybe you had a costly emergency or a family member crisis that affected your ability to make rent this month. Before you dig into options for one-time assistance or start borrowing money, it’s worth considering if financial hardships are likely to persist.
If your ability to pay any given month’s rent is on shaky ground, consider applying for federally subsidized housing. HUD requires eligible landlords to keep rent at a fixed portion of the renter’s income. Just be aware that a rental application for these affordable units can be competitive and time-consuming and that relocating comes with its own costs, like application fees and moving expenses.
8. Create a Budget to Ensure You Can Make Future Rent Payments
Once you leverage assistance funds from an emergency rental assistance program, you’ll need to convince your property management company that you have a rent payment plan in place.
Eviction proceedings that involve legal representation are expensive for everyone, so most landlords will be open to extending a lease agreement if there is an open and honest discussion about your budget and finances.
Nicole Dow is a former senior writer at The Penny Hoarder. Kaz Weida, a staff writer at The Penny Hoarder, contributed.
