Eviction Moratorium in Minnesota

4 Replies

@Annie DiCenzo  

Minnesota’s eviction status is at the whim of the Peacetime Emergency which was extended to January 13.

MN Executive Order 20-79 is the current rules on evictions.

Executive Order 20-100 extends Peacetime Emergency to January 13.

Executive Orders:https://mn.gov/governor/news/executiveorders.jsp

The eviction moratorium at the federal level (enacted by the CDC) is currently through January 31.https://www.cdc.gov/.../covid-eviction-declaration.html

@Annie DiCenzo expanding upon @Daniel Anshus reply on current standing of MN eviction moratorium; 

I give 99.7% chance tht Gov. Walz will, yet again, extend the moratorium order via extension of emergency powers. About 3 extensions ago, maybe 4 now, Walz re-wrote the eviction moratorium order to state it remains in affect as long as emergency powers remain in affect, so every extension of 1 extends the other unless an order is passed specifically ending the moratorium. 

I recognized the political strategy and positioning back in May 2020 and soon after predicted that if the order was not lifted by Nov 1st, that we would be under it until at least March '21'. I wish i was wrong on that, sometimes being correct really sucks. 

At this time and with all factors and conditions, I unfortunately see March as a highly optimistic projection. Worse yet, all indicators at this time say to me that a realistic timeline for lifting of order is more like September, and even that is a maybe. There seems to be no shortage of influence pressing for considerable extension of the moratorium including other reasons other than covid. 

The brutal truth of it is a landlord has to be situated to perform in a perpetual moratorium environment. I know it sucks, it royally sucks but it's also the pure analytics of it. The next item to happen as covid numbers improve is going to be protests to persons poverty and mass homelessness if moratorium is lifted. 

If your dealing with occupancy issues associated with moratorium, I highly suggest getting with a pro at mitigating such items IN a moratorium environment. As it stands I am the only person I know who has done this to the extent that I have, I know 1 other person who only had 1 that self resolved and that's it which is saying something as i know a lot of people in this industry, the vast majority are not attempting to navigate the waters. I have heard of a few others, that's about it. So if/when looking for assistance on such it's most likely going to be very very few of us in the entire state. 

The rights you have as a landlord are still there, just intensely impacted. You can still evict, in some cases and there are a few means available to take occupancy back from tenants with or without tenants acceptance. It's tough stuff, many attorneys don't want to touch on any of it because of the difficulty level. But, options do exist. 

For all my clients i am stressing our most extensive tenant screening and highest standards possible. That and ready use of civil suite is best defense in this setting. There is the possibility of leasing 1yr at a time and charging a singular whole dollar amount, up-front, than extending financing option on that "completed charge" via 12 monthly payments. Think of how a person buyers a car at the "buy here pay here" dealers. As those business's exist and operate, with conveyance for use of an asset, the contract law also exists in some form or fashion. I havn't used this yet myself but have been considering it more and more. 

@James Hamling intriguing, there are third party companies who would facilitate something like this? Not sure if I understand completely, but the entire year is financed, owner gets a lump sum, lender assumes the burden of risk? Or am I way off... 

Originally posted by @Adam Tafel :

@James Hamling intriguing, there are third party companies who would facilitate something like this? Not sure if I understand completely, but the entire year is financed, owner gets a lump sum, lender assumes the burden of risk? Or am I way off... 

 That is 1 possibility in all of it, not my primary thought on it but yes that is a secondary one I have considered and there are companies doing nearly identical lending who would be ideal to do this kind of financing, one was formerly known as GE Capital so yes they have the $$$$ to fund such. 

My primary thought is on how nearly all comapnies currently work business vendor accounts. Company XYZ makes windows, Bobs Window Service buys windows from XYZ. Bob had to sign a commercial credit application and contract saying in short that when he places an order with XYZ it's done, that purchase is made, and credit is extended to Bobs Window Service, of which he must make payments on that credit account per _______ terms. This is very common in the products industry to defend against person putting in orders and than later canceling and walking away. In order to charge the fee's possible the sale must be completed and closed at time of sale, and credit must be used if payment isnt made as contract law requires and equitable EXCHANGE, ie pay $ and get ____. My thought is drawing from that existing contract law and commerce, simply adjusting a tad and applying it to real estate and tenants which is still an equitable exchange of goods or services. 

In short, tenant agrees to a 12mnth lease and makes payment in full at commencement for the entire 12 months. BUT just like the XYZ window company, the landlord company allows tenant to apply, and be accepted for, a line of credit of ___, and allows to make payments under the terms of ____. Now that money is governed under commerce laws as they apply to credit and default on credit repayment, such as all the collection methods in law and impact on credit report etc etc. I do not know of any law that can ban that, dictate how a product/ service can be billed. Think of car sales, it is almost identical to auto sales, it's an asset, large price, terms etc etc, the only real legal difference is an auto can change locations and a property is fixed in location. 

So step 1, landlords can extend there own credit agreements and accounts. Step 2 would be financing vendors offering to step in the middle, exactly as they do for home remodelers. Remodelers offer "financing" on a project, which is actual via synchrony or whoever else, that contractor pays 5% of total amount financed so they can get there $ immediately vs over 3yrs or whatever. Contractors can self finance, but its worth the 5%, everyone wins. 

As i said before, it's a thought I have and havn't had chance to vet it through as of yet but I really think in short order I will be.