With massive levels of unemployment making rent and mortgage payments difficult for many, tenants and property owners across the city have been impacted by the economic shutdown necessitated by the novel coronavirus outbreak. In fact, after the Chicago Department of Housing initiated the COVID-19 Housing Assistance Grant Program last month, they received 83,000 applications for one-time $1,000 grants.
While the agency is working to fund a second round of help, Mayor Lori Lightfoot introduced an initiative today seeking buy-in from the private sector to reduce the potential for displacement during the coronavirus pandemic. The Chicago Housing Solidarity Pledge seeks to act as a stopgap measure for both renters and property owners.
Lenders who sign on to the pledge affirm they “may provide” a number of services for landlords who are struggling due to the financial impact of the statewide shutdown:
- A grace period for mortgage bills that includes deferred payments options that do not require immediate repayment at the end of the deferral period
- A moratorium on foreclosures until May 31
- Neutral reporting to credit agencies for any loans that were not delinquent prior to the deferral agreement
- Relief from fees related to late or missed payments
The mayor’s office noted that Bank of America, BMO Harris, Byline, CIBC, Fifth Third, First Eagle Bank, First Midwest, Northern Trust, PNC, US Bank, Seaway Credit Union, Second Federal Credit Union and Wintrust have all committed to the Chicago Housing Solidarity Pledge.
Similar to the lender side of the agreement, landlords were called upon to offer the following to their tenants as part of the pledge:
- A grace period for rent bills that includes deferred payments options that do not require immediate repayment at the end of the deferral period
- A written repayment plan that will allow renters to amortize what’s due over time
- Relief from fees related to late or missed payments
“The Chicago Housing Solidarity Pledge is about compassion and flexibility,” Housing Commissioner Marisa Novara said in a statement. “It’s about everyone doing their part. We are asking landlords to work out flexible payment plans with tenants, and to do so, they need flexibility from their lenders.”
The Chicago Association of Realtors, alongside other groups such as the Chicagoland Apartment Association and Neighborhood Building Owners Alliance, have also signed on.
“The apartment industry is committed to being part of the solution for renters and housing providers in need during these unprecedented times,” said Michael Mini, executive vice president of CAA. “We are all in this together, and in thousands of recent instances, multifamily building owners and managers are working with tenants individually on extended payment plans, waiving late fees, and offering significant grace periods, just as the mayor has asked. We expect these types of accommodations to repeat tens of thousands of times going forward. We’re all in.”