Putting People First
I was struck by the headline on an article at BiggerPockets by Alexandra Hughes titled “Putting People First.”
When it comes to business needs, it’s easy to forget that our renters are people, too. In a time of crisis like the pandemic we’re experiencing now, it’s more important than ever to remember that.
‘I know a thing or two about people—if you haven’t checked out my bio, I’m the People Operations Lead at BiggerPockets. However, you certainly don’t have to be in human resources to understand the needs of people.”
Before getting into Hughes article, I’ve read a lot about the dire situation renters and homeowners find themselves in. No job, no income, and unable to pay their rent. Sure, there is a moratorium on evictions and foreclosures. But what happens after the lockdown is over? Besides sympathy, though, there has been no mention of a way to handle the payments in arrears.
Putting People First Kansas City
Hughes had a tenant that hadn’t resigned the lease. “If I hadn’t reached out to her and talked through her concerns—ultimately adjusting the lease for her—my gut says she would have moved.
[…]
“Because of the simple conversation where I showed empathy, kindness, and flexibility, she at least thinks well of me. And hopefully, as a result, she wants to stay in the home she is renting for as long as she is able.
Why is it important a Tenant Stays?
Joseph Asamoah at BiggerPockets explains, “Any seasoned buy and hold investor/landlord will tell you without a doubt that the biggest profit killer is turnover and vacancy. In my market, every lost tenant can cost me upwards of $5,000-$8,000 in cleaning, repairs, vacancy, time, and lost income. (FYI, I’m in a high-priced market where single-family rents range from $3,500-$5,000 per month.)”
“I want to avoid that at all costs by finding long-term tenants who would never dream of leaving. That is the only way, in the long run, that I generate positive cash flow and stay in business. I regularly and consistently get 10 to 15-year tenants.”
Last week the Fed launched several new programs:
The Paycheck Protection Program Loan Facility (Purchase of $350 billion in SBA Loans). The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll.
SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.
You can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating in the program.
Lenders may begin processing loan applications as soon as April 3, 2020. The Paycheck Protection Program will be available through June 30, 2020.
A Main Street Business Lending Program ($600 billion in additional Small Business Loans). The Federal Reserve’s “Main Street” business lending program will be designed for companies in the middle — too big for small-business loans and too small to tap capital markets, said San Francisco Fed president Mary Daly on Tuesday,
“There is a whole swath of institutions that don’t access capital markets very easily and don’t qualify for small-business lending. That’s a part of Main Street that still needs to be treated that directly employs literally millions of workers,” Daly said, in an interview on Yahoo Finance.
Congress has appropriated $454 billion for Fed programs in an unprecedented attempt to get the central bank’s lending powers to help dampen the blow to the everyday economy from the coronavirus outbreak.
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