We've rarely experienced a more somber April Fool's day than yesterday, when the true gravity of the economic consequences of the COVID-19 pandemic hit home for Santa Fe families who were unable to make their full rent payments on the first of the month.
Both the New Mexico Supreme Court and the city have issued orders that suspend evictions during the crisis, though neither frees tenants from the obligation to pay their rent owed in the long run.
Yet many Santa Feans have been left wondering: How do I know if this applies to me? I'm late on my payment, what now? Does the mayor even have the authority to stop landlords from evicting people?
The orders also do not offer any relief for people who own their own homes and are suddenly questioning their ability to make mortgage payments, or landlords who might be put in a bind if tenants can't pay.
In an effort to quell some of our collective anxiety, here's the lowdown on what the eviction orders actually mean for renters and landlords, and how to look for some relief if you can't pay your mortgage. We also recommend checking out the Santa Fe Housing Action Coalition's handy COVID-19 Housing Resources page for a breakdown of local options for anyone experiencing housing difficulties in this time.
On March 13, Santa Fe Mayor Alan Webber issued an emergency order prohibiting landlords from evicting residential and commercial property tenants within city limits who can't pay their rent on time because of the public health emergency. Under the city order, a landlord can still seek to evict a tenant for any other reason or if their inability to pay rent is unrelated to the crisis.
City Attorney Erin McSherry tells SFR by email that the mayor has legal authority to do this because Santa Fe is "a Home Rule municipality, which under the state Constitution allows for regulation of civil relationships when they are incident to the exercise of an independent municipal power." In other words, when the mayor declares an emergency, he can determine what is allowed and to prohibit whatever activities are deemed necessary to keep the peace.
On March 24, the New Mexico Supreme Court issued a similar order that stops judges from carrying out eviction orders. The court order applies more broadly to any residential tenant who can't pay rent during this period, regardless of the cause. However, the tenant may still have to prove that they cannot pay rent in court.
Normally, when a tenant does not pay rent on time, landlord are required to give the tenant a written three-days notice of failure to pay before they can take the tenant to court to order an eviction.
According to state law, a landlord is not allowed to force a tenant to leave and can't change the locks or cut off utilities without an official court order that includes the amount owed by the tenant and a move-out date set three to seven days from the date of the hearing. The tenant has to pay rent for each day they remain in the residence, along with any late fees, and if they don't move out by the date set by the court, the county sheriff will enforce the eviction.
The Supreme Court's order doesn't change this process or stop landlords from taking tenants to court to obtain a "writ of restitution"—the fancy legal term for an eviction order—for failing to pay rent, says Barry Massey, spokesman for the Administrative Office of the Courts.
But judges have been ordered to stop enforcement eviction orders until after the pandemic is over and the Supreme Court reverts the law back to normal.
While the mayor's order applies to commercial tenants as well as residential tenants, the court order only applies to residential tenants.
Under both orders, you still owe your rent even if you can't be evicted and your landlord can still charge late fees.
The city suggests tenants should work with their landlords to negotiate rent payment plans or other alternatives, and, in large part, this is what tenants have done, property managers across the city tell SFR.
Against this backdrop, a movement for even more extreme relief measures has been brewing.
A petition circling on Facebook this week asks state and local officials to freeze all rent and mortgage payments for at least two full months. The petition reflects a growing national movement of working-class people demanding a moratorium on all manner of housing payments.
Real estate industry professionals caution this kind of broad action could have wider ranging consequences that reverberate all the way up the profit-driven housing food chain and end up impacting the community in unexpected ways.
"We are all connected, and if people stop paying rent completely and other people don't pay their mortgage it just has a snowball effect," says Samantha Monnet, the owner of Valdez and Associates property management firm in Santa Fe.
Monnet tells SFR five of the 250 tenants at properties she manages called before April 1 to say they wouldn't be able to make the rent. She says she's heard from just as many landlords who are worried they won't be able to make their mortgage payments and who depend on rental income.
She says she's asked tenants to pay whatever they can now, and will address the situation again after April 15, when some of the promised federal government aid will hopefully start coming through.
Lance Armor, a local mortgage broker and owner of Santa Fe Mortgage, says he's particularly concerned for people who are paying down the mortgages on their own homes. He says many of his clients are regular working people who must make monthly mortgage payments to stay in their homes and may be unable to do so without a steady flow of income. The last loan he negotiated, for instance, was for a local firefighter, he says, adding that he has clients who are nurses, real estate agents and musicians.
Because mortgages are governed by federal law, local officials do not have the jurisdiction to change payment options. But national lenders have begun to respond to the national emergency and negotiate payment options with borrowers.
On March 18, the US department of Housing and Urban Development issued a 60 day foreclosure and eviction moratorium for all FHA-insured Single Family mortgages.
Frannie Mae and Freddie Mac have directed lenders to work with borrowers in a bind to reduce or suspend payments for up to 12 months.
Fortune Magazine reports that this alone covers half of all home loans in the country, and predicts that other lenders will follow this example in coming months. The magazine advises readers to ask their lenders for a mortgage modification to skip payments for a set period of time. As with renters, homeowners are advised to reach out to their lenders as soon as possible to work out a deal instead of simply not paying what they owe.
Editor's note: An early version of this story's first sentence said hundreds of Santa families could not pay rent. The number is unknown.
