CFPB/FTC Warn Large Apartment Landlords About New Rules

By Kerry Smith

New rule: Debt collectors must give tenants written notice about their rights under the CDC moratorium – and they can’t misrepresent a tenant’s eligibility for protection. To spread the message, the consumer bureau directly contacted landlords who represent about 2 million units.

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) Acting Director Dave Uejio and Federal Trade Commission (FTC) Acting Chairwoman Rebecca Kelly Slaughter sent notification letters to the nation’s largest apartment landlords, which collectively own more than 2 million units.

The letters remind landlords of federal protections that keep tenants in their homes and stop the spread of COVID-19.

The Centers for Disease Control and Prevention (CDC) extended a temporary moratorium on evictions for non-payment of rent until June 30, and the CFPB issued an interim final rule that establishes new notice requirements under the Fair Debt Collection Practices Act (FDCPA).

“Landlords should ensure that FDCPA-covered debt collectors working on their behalf, which may include attorneys, notify tenants of their rights under federal law,” says Uejio. “Nearly nine million households are at risk of eviction due to the economic effects of COVID-19, but no one should lose their home without understanding their rights. We will hold accountable debt collectors who move forward with illegal evictions.”

“We are continuing to monitor this area and will act as needed to protect renters,” adds Slaughter.

The notification letters are the CFPB and FTC’s latest public action supporting the CDC moratorium, which generally prohibits landlords from evicting tenants for non-payment of rent if the tenant submits a written declaration that they can’t afford full payments and would likely become homeless or move into shared living if evicted. The prohibition also applies to any agent or attorney acting on behalf of a landlord or residential property owner.

The letters ask landlords to examine their practices to ensure they comply with the CDC Moratorium and the FTC Act and remediate any harm to consumers stemming from any law violations. It also encourages landlords to notify FDCPA-covered debt collectors working on their behalf, which may include attorneys, of the CDC moratorium, applicable state or local moratoria, and those parties’ obligations under the FTC Act and FDCPA, including the CFPB’s interim final rule.

Effective Monday, the interim final rule requires debt collectors to provide written notice to tenants who may have rights under the CDC moratorium and prohibits them from misrepresenting tenants’ ineligibility for protection from eviction under the CDC moratorium.

On March 29, Uejio and Slaughter issued a joint statement regarding their agencies’ work to help stop illegal evictions and protect American consumers facing economic hardship due to COVID-19. Neither the CFPB nor the FTC has determined whether the letters’ recipients have violated the law.

More information about the CFPB’s interim final rule requiring notices to tenants is posted online.

© 2021 Florida Realtors®

Reprinted with permission.

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