Forced Rent Talks Before Eviction Suit?

If landlords think rent controls & Fair Housing Laws are a pain, they might think what life would be like if they owned in Philadelphia where a new “diversion” program makes them go thru out-of-court talks before they can even try to evict a tenant. Maybe sweeter?

Of course, many tenants who miss the rent payment have good reasons for mercy & need reasonable leeway to do catch up. Tenant-landlord courts typically have an “equitable mindset” that informally if not formally take life’s unavoidable miseries into account when considering a landlord’s eviction suit. But, the problem with eviction litigation from a tenant’s perspective is the stigma that attaches to them in terms of getting future digs, credit cards, and so on. Philly is among the poorest metropolises and the city anticipated a post-Covid wave of evictions, as other cities were experiencing, and it knew the pain of folks being evicted in legal proceedings would devastate them. The new diversion program has been tried in some other cities, the WSJ coverage noted, but what’s different in the City of Brotherly Love is that face-to-face negotiations must be undergone BEFORE any court filing is made.

Interestingly, after the new requirement was implemented, lawsuits are down 41% compared to earlier years. Perhaps even more interesting, is that rents continue to go up (perhaps because of the higher “loss rate”?) while everyone is spared the costs of litigating. Could this be a win-win progressive idea that’s worth watching more closely?

Davd Soul