Some 100,000 families who may face eviction for their inability to pay their home rents due to unemployment or loss of livelihood brought about by the Covid-19 pandemic, may soon find relief.
Albay Rep. Joey Salceda, chairman of the House Ways and Means Committee, has recently filed House Bill 7665 aimed to provide them relief. Based on the Philippine Statistics Authority’s 2015 census, he said some 2.7 million households occupy rented housing. The number estimated to have increased to about 3.1 million by 2020.
“Our analysis of the newly unemployed shows that up to 3 percent of these households, or some 93,000 households, may be in danger of eviction due to nonpayment of rental dues even with the Bayanihan measures to provide rent relief,” he noted.
Salceda said HB 7665, or the proposed Rent Relief Act of 2020, will provide a three-month moratorium on evictions, to allow both tenants and landlords to “renegotiate rental terms as well as refinancing options for renters.”
“Bayanihan rent deferments are good, but because it takes people longer than three months to find new jobs, we still run the risk of eviction unless we can find ways to get pending rent paid now, and allow tenants more time to finance their rent. Deferments alone, however, are unsustainable because lessors, many of whom are retirees, need to eat, too,” the lawmaker said.
The proposed measure mandates the Social Security System, the Government Service Insurance System and the Pag-Ibig Fund to offer rent refinancing loans to their members at favorable rates. It also tasks Land Bank of the Philippines and Development Bank of the Philippines to offer rent refinancing loans at rates not higher than their lowest-yielding loans.
Under rent refinancing, banks will pay rent for a specified period while providing the tenant a much longer loan repayment period. “For these households, measures that not only defer payment schedules, but actually get the rent paid for a period that is long enough to regain meaningful employment are urgently needed,” Salceda said.
HB 7665 also allows promissory notes to be accepted, under an arrangement where government financial institutions finance the promissory note, and the rent obligation is converted into a loan with a government financial institution, to ensure that the tenant is not evicted during the period paid for with the loan.
To allow tenants reasonable time to avail themselves of the programs under the bill, it imposes an eviction moratorium for three months, to provide the implementing agencies enough time to roll out the measures contained in the bill.
The bill also mandates setting up rental assistance centers by the Department of Human Settlements and Urban Development to help tenants and lessors renegotiate terms of lease, access programs under the bill, and find other assistance programs available that would prevent tenants from being evicted.
“While current grace periods under the Bayanihan emergency measures allow for amortizations to be distributed in the succeeding months of rent, these grace periods may not be of much help to tenants who have totally lost their sources of income,” the lawmaker said.
“At the same time, grace periods which disrupt the consistency of payments to lessors may also harm property owners, typically the elderly or the retired who rely on rental revenue as their main source of income,” he added.
Salceda said his bill would complement rent payment deferment strategies and would be a “more financially sustainable approach that would restore stability and consistency” in the rental terms for tenants and lessors.
Without consistent income from rentals, lessors may also not be able to maintain the quality of their property to the detriment of both the owners and their tenants, he explained.