When the Covid crisis hit in March and parts of the economy shut down, Heaven and her partner Jeremy were suddenly out of work. Heaven is in the hospitality field. Jeremy is a truck driver. The couple have four children, and the family lives in one of Southwest Solutions’ affordable apartment buildings in southwest Detroit.
Without employment and savings to weather the crisis, Heaven and Jeremy found themselves unable to make their rental payments. As the pandemic and its economic fallout persisted, their arrears and late fees continued to escalate. The eviction moratorium means that the family can remain in their unit for the duration, but Heaven and Jeremy also knew that when moratorium ends, their debt will come due without their having the means to pay it off in a timely way. The couple was very worried about their family retaining their stable and quality housing.
Southwest Solutions is one of the largest providers of affordable housing in Detroit. We manage about 700 units that we have created for low to moderate income households. The vast majority of those living in our units are working individuals and families. However, many of these jobs are in industries particularly vulnerable to the economic adversity caused by Covid. As a result, many of our tenants have fallen behind on their rent and need financial help to catch up. The struggle that our tenants are facing is indicative of the Covid-related rental crisis across the city, state and country. Nationwide, it is estimated that 40% of all renters are at risk of eviction, and the United States is on the verge of the most acute housing crisis in its history.
To help address the crisis in the state, the Michigan State Housing Development Authority (MSHDA) is implementing an Eviction Diversion Program (EDP). Through this EDP, $50 million is available statewide to assist at-risk income-eligible renters. In Detroit, this EDP is being administered by the United Community Housing Coalition (UCHC) in collaboration with other organizations.
Southwest Solutions has been encouraging and prepping our tenants who’ve fallen behind on their rent because of Covid to apply for the EDP. Landlords participating in the EDP must agree to forgive up to 10% of the amount due and late fees in order to receive payment for their tenants’ back rent. Recently, we partnered with UCHC to arrange a special event to process the EDP applications that our tenants have filled out. Thus far, 125 of our tenants have applied.
“We made a concerted effort to reach out to our tenants about the EDP, and we’ve had excellent participation in the program,” said Rito Villareal, Residential and Commercial Regional Property Manager at Southwest Solutions.
Heather came to the event and met with a UCHC counselor to review her paperwork. Her application was accepted, and almost all of her back rent will be covered.
“I’m so relieved,” Heather said. “This allows us to stay in our home and get a fresh start.”
Ontae also attended the event and submitted his completed application. Ontae has lived in his Southwest Solutions’ affordable apartment for two years. He had been working as a driver for the Salvation Army until he was laid off in March when the shelter-in-place order went into effect. As his joblessness continued and he fell further behind in his rent and other bills, Ontae relapsed in his addiction. He then spent time in rehab to recover.
“I didn’t know what to expect when I applied for rental help, but I was scared that I wouldn’t be able to stay in my place,” Ontae said. “I’d already started thinking about where I might go and was looking at halfway houses for people who’ve recently gone through rehab.”
At the EDP event, Ontae learned that about 80% of his arrears will be covered. The remainder of his balance will be spread out and added on to his rental payments next year. Ontae is still worried about regaining employment, and he is actively looking for opportunities to earn a living once again.
The stress that renters have been suffering has also been stressful for our property management team, who are committed to helping families and individuals in our units remain housed and experience a successful tenancy.
“We are grateful to have the EDP resources to assist the people we serve through this time of incredible hardship,” said Asia Johnson, Property Manager at Southwest Solutions.