What’s the Rental Assistance Program and How Does it Work?

The Emergency Rental Assistance program was first introduced in December 2020, under the Consolidated Appropriations Act. This program, dubbed ERA1, provides up to $25 billion in funding to help out households that are struggling with rent and utility payments. 

The second phase of the Emergency Rental Assistance program or ERA2 was outlined in the American Rescue Plan Act of 2021. This Act, which took effect in March 2021, added another $21.55 billion to the rental assistance funding pot. 

Both ERA1 and ERA2 offer rental assistance money directly to states, U.S. territories and local governments. The first incarnation of the Emergency Rental Assistance program also allows for money to be distributed to Indian tribes or tribally designated housing entities. 

Under the terms of the program, COVID-19 rental assistance includes financial help for:

• Rent
• Utilities
• Home energy costs, including electricity, gas, fuel oil, water, sewer and trash removal

You may also be able to get rental assistance to pay for other costs as a renter. Those can include:

• Reasonable late fees that aren’t included in your rental or utility debt
• Internet service to your home
• Moving expenses and related fees if you have to move
• Housing counseling
• Case management
• Legal representation
• Other housing stability services

Since rental assistance programs are administered at the state and local levels, the benefits you might qualify for can vary based on where you live. 

Generally, the program allows eligible households to receive up to 12 months of assistance with rent, including overdue rent payments, dating back to March 13, 2020. But state or local rental assistance programs may allow you to bump that up to 15 or 18 months’ worth of rent. You don’t have to be behind on rent payments to apply. 

The Emergency Rental Assistance program has seen several updates since it was initially introduced. The Treasury Department made these revisions in 2021:

• Clarifying eligibility requirements for ERA 1, based on unemployment status, household income and homelessness risk
• Providing flexibility with regard to documentation of eligibility based on income, unemployment and financial situation
• Adding rental security deposits as a permissible expense 
• Providing guidance on how to distinguish between ERA1 and ERA2 and how each one should be used to offer rental assistance 

There have also been updates with regard to relief for renters who are facing eviction. CARES Act rental assistance provided for a temporary moratorium on evictions for renters who were unable to pay rent because of the pandemic. This began in March 2020, with several extensions enacted by the Centers for Disease Control. The most recent extension occurred in June 2021, pushing the deadline for an end to the moratorium to July 31, 2021. The CDC again extended the moratorium until October 3, 2021 for individuals in counties experiencing high community transmission levels of SARS-CoV-2.

The eviction moratorium covers renters who:

• Have used their best efforts to get help from rental assistance programs
• Earned $99,000 or less (or $198,000 if filing jointly) during the 2020 calendar year or experts to earn no more than those amounts for the 2021 calendar year off or out-of-pocket medical expenses
• Are making a best-effort attempt to pay their rent, even in partial amounts
• Would likely end up homeless or require a drastic change to their living condition if they were evicted

States have taken steps to protect renters against eviction. In California, for example, an eviction moratorium is in place statewide through September 30, 2021. But individual cities can also implement eviction moratoriums as part of rental assistance programs, as San Francisco and New York City have done. 

The Emergency Rental Assistance program is ongoing and there is no end date, other than when funding runs out. But it’s possible the government may grant additional funds to help renters and landlords with rental assistance. 

The most important date to know for rent assistance is March 13, 2020. This is the earliest date for which you can claim rental assistance. You may also want to keep the October 3, 2021 CDC eviction moratorium deadline in mind if you’re concerned about the possibility of being evicted and you believe you live in an eligible area. You can check with your state or local government for any other dates regarding the end of eviction moratoriums. 

The Emergency Rental Assistance program allows local rental assistance programs to cover rent and utilities for low-income families specifically. So this typically means households with income that equal 80% or less of the Area Median Income (AMI), based on family size. 

So generally, to qualify you must:

• Have some type of rental agreement in place
• Have someone in your household that has qualified for unemployed, lost income or experienced other financial hardships as a result of the pandemic
• Be at increased risk of becoming homeless because of your inability to pay rent

Since funding is administered at local and state levels, you can’t get help directly from the U.S. Treasury. But you can use the Treasury Department’s ERA Program finder tool and the National Low Housing Income Coalition database to find COVID-19 rental assistance programs in your area. 

You’ll also need to check your income against the Area Median Income to find out if you qualify for help. Fannie Mae offers an Area Median Income lookup tool you can use to get the numbers for where you live. 

Once you’ve identified your local pandemic rental assistance program, you can contact them to learn more about how to apply. You’ll need to be able to show proof of income (or lack thereof), proof of housing instability and proof of what you normally pay for rent. If you’re seeking rental assistance for utility payments or other covered costs, you’ll need to provide statements or receipts showing those amounts. 

The easiest way to find state and local rental assistance programs is to search online. There are several sites you can use to find COVID-19 rental assistance, including:

• Treasury Department Emergency Rental Assistance lookup tool
• National Council of State Housing Agencies database
• National Low Income Housing Coalition
• Department of Housing and Urban Development

You can also check the websites of your state and local government’s housing authority. You may be able to find information concerning rental assistance programs for pandemic relief, as well as other options for finding affordable housing. 

Keep in mind that if you’re looking for rental assistance outside of pandemic programs, the requirements and the level of aid you may qualify for could be very different. And if you’re in danger of being evicted, you may be able to get free help through your local legal aid organization. 

If a large portion of your budget goes toward rent, rental assistance programs could help create some breathing room. But if you don’t qualify, you may want to consider other options, like negotiating your rent down or taking on a roommate or two. The sooner you start looking for solutions, the sooner you can minimize any potential negative impacts associated with falling behind on rent payments.