As rent protection programs expire, the CFPB says renters may be at risk

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The agency offers tips and says consumers should not be shy about asking it for help

Housing vulnerability for renters became a major issue for the Biden administration, but now that eviction protection has effectively ended, millions of renters and their families put at risk by COVID-19 may be in harm’s way, according to a new report from the Consumer Financial Protection Bureau (CFPB).

The report -- “Financial conditions for renters before and during the COVID-19 Pandemic” -- concludes that, while several government relief efforts may have helped maintain the financial stability of renters and their families, those same people may now be at risk.

“Today’s report confirms that renters, when compared to homeowners, are more likely to be Black or Hispanic, more likely to have lower incomes, and more likely to be women. They are also at particular risk of falling further behind as the nation recovers from the economic impacts of COVID,” said CFPB Acting Director Dave Uejio in a press release

“Past recessions and depressions have seen communities of color and low-income communities of all races and ethnicities left behind when the broader economy recovers. We cannot repeat that history. The CFPB is committed to helping renters and their families thrive. We must amplify and protect the modest gains renters made during the pandemic to ensure this nation’s full and equitable recovery from COVID-19.”

Some demographic groups hit harder than others

Comparing renters and homeowners, researchers unearthed some interesting nuances. For example, compared to homeowners, renters are more likely to be Black or Hispanic, younger, and lower-income than other demographic groups.

Prior to the pandemic, renters’ debt obligations were also significantly different from homeowners. As an example, the agency cited the situation in June 2019, when renters were more likely than homeowners to have student debt and to have used some form of alternative financial service, such as payday and auto title loans.

“During the pandemic, despite poor labor market conditions, renters’ financial conditions, on average, appeared to improve as much as, or more than, those of homeowners. Renters’ credit scores grew by 16 points during the pandemic, compared to 10 points for mortgagors and 7 points for other homeowners,” the study reported. The report made special mention that, in situations where renters’ credit scores may have improved, those scores remained substantially below those of homeowners.

What renters can do if impacted by the change

The CFPB appears to be as proactive as possible in defending renters in this situation -- at least with credit reporting agencies such as Equifax, TransUnion, and Experian. It said it has reminded those companies that they have an obligation to report rent payments and evictions accurately. 

“Accurate reporting is now even more essential with the new mortgage underwriting process announced by Fannie Mae last week, which will add rental payments to the evaluation process for mortgage qualification and approval. The CFPB will use today’s report to inform how best to support an equitable recovery for renters and all Americans,” the agency said.

Consumers who encounter rental information errors or other errors on their consumer reports, or believe such errors exist, have rights and recourse. Consumers have the right to:

  • Review their credit reports from the nationwide CRAs. Normally, consumers can request one free consumer report every 12 months from each of the three nationwide CRAs (Equifax, Experian, and TransUnion). However, through April 2022, consumers can request a free report weekly.

  • Dispute errors identified on their consumer reports. Consumers have the right to dispute mistakes on their consumer reports with the CRA and/or the furnisher.

  • Review their reports from other consumer reporting agencies. For a list of some of the companies offering reports, such as tenant screening reports, please visit the CFPB blog.

If all else fails, the CFPB is open to complaints on its website. The agency says that consumer complaints are important for its enforcement actions and that consumers should feel free to let it know of any issues.

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