Landlord Risk Mitigation Fund expands options for young adults hardest to house
No credit history. No previous landlord references. A criminal background.
“(This individual had), basically, every type of barrier that you could see as a struggling young adult,” said KateLynn Dudley, Housing Case Manager for Evergreen Youth & Family Services. “But in addition to all of that, they had done everything that they needed to; they were doing really good.”
Scenarios such as this are exactly what the Landlord Risk Mitigation Fund aims to address: By providing a safety net to willing landlords, young adults are able to secure housing that they would not otherwise be able to access.
The Northwest Minnesota Foundation’s Landlord Risk Mitigation Fund (LRMF) became available in May, offering what equates to rental insurance for those who have barriers preventing them from accessing housing. The fund covers up to $3,000 in property damage or lost rental income, providing landlords with financial assurances.
Already, individuals are benefitting from the program. Some of those housed due to the assurances provided by the LRMF include clients of Evergreen Youth & Family Services who work with staff through the HUD Permanent Supportive Housing program, which provides ongoing supports and transitional housing to those who have been experiencing homelessness for at least a year or experiencing recurrent homelessness for months at a time.
“Generally, permanent supportive housing is for those who are really the hardest to house successfully,” said John Fick, Program Director at Evergreen. “They need case management and support – lots of support – and, with their backgrounds, they’re the hardest to find housing for because we need to find landlords who are equipped and willing to take a chance on them.”
One individual housed through the LRMF had been experiencing homelessness for six years, since they were a minor; Evergreen had been actively trying to find them housing for four years. They had no credit and no rental history, a risky scenario for a potential landlord.
Housing for another individual, whose barriers were briefly described in the opening of this article, benefitted not only this person but also younger children. They all had been living in a single-bedroom transitional housing unit until they moved into a three-bedroom duplex.
“They were pretty stable in the transitional living program, but it’s really hard to see kids flourish when they’re cramped into close quarters,” KateLynn said. “Being able to have a room to express yourself in, to decorate how you want, is huge to a child – and now they’re not fighting as much with each other.”
‘Landlords helping landlords’
John Fick was recruited to join the advisory committee for the LRMF not only due to his current role at Evergreen but also because his past professional experience includes insurance work and a familiarity with legal processes.
“(The fund) is a fantastic opportunity,” John said. “The examples of those we’ve been able to house through this program are poster-child examples of what the program was meant for. It is really right on point in terms of meeting a need. I’m excited to see where it’s going to go in the future.”
Since COVID-19 emerged, rental availabilities are low, and a requirement for double-deposits is not uncommon. While Evergreen has been able to access additional supports to provide those extra funds, in certain cases landlords need even more assurances.
“Potentially, there is more money available through the Risk Mitigation Fund (than double-deposits), but I think there also is an enhanced aura of trustworthiness,” John explained. “With the Northwest Minnesota Foundation actively backing this, they’re driving this process, and reputable agencies are involved in supporting it.”
Landlords are also among those who serve on the advisory board, giving them a voice and allowing service organizations and landlords to cooperatively address scenarios and issues that long have stalemated the two groups.
“We have both housing agencies and landlords on the advisory board, so it’s landlords helping other landlords and I think that combination of that partnership all the way around is a real difference-maker.” John said.
Some of those now housed through the assurances offered through the LRMF have been housed at properties managed by Vision Properties, which manages nearly 300 units in the Bemidji area with the motto “building a better community”.
“(The LRMF) is offering exactly what would help a landlord to be willing to take additional risk for applicants who wouldn’t normally otherwise qualify,” said Andrew Erholtz, with Vision Properties.
Andrew is the president of the Headwaters Landlord Association and became aware of the LRFM through that organization. He noted that the fund is there should it ever become necessary, but Vision Properties has not yet needed to access that funding.
“We care about people. I’m in this business for the sake of people,” Andrew said. “I have to maintain a successful financial business … but when I’m advocating for a high-risk applicant to the owners that I manage, I need to be able to show them that this a good decision. It’s going to make you feel good as an owner, but my job is also making sure you get your rents on time and your property isn’t damaged once the lease is over.”
The LRMF provides that assurance that should a problem arise, the property owner will be covered.
The Landlord Risk Mitigation Fund is available throughout NMF’s Northwest Minnesota region, which includes two tribal nations and 12 counties. Currently, seven landlords are signed up to participate. As positive experiences occur and are shared throughout the region, the hope is that additional landlords will sign on. Landlords who are interested in learning more or participating are encouraged to visit the LRMF website online.
“Being able to see the effects of the committee’s work and the fund’s existence is incredibly exciting for us,” said Margret Treuer, the NMF Program Officer who works with the LRMF advisory committee. “We’re thrilled that the Landlord Risk Mitigation Fund is already helping young adults access much-needed housing. But we do want to help even more.”
Ongoing case management is required for those benefitting from the LRMF. Additionally, those housed must also be enrolled in a program that provides rental assistance, which is another assurance offered to landlords.
“There is no silver bullet solution to homelessness,” John said. “This is, from my perspective, the type of program we need – a partnership through which organizations that are advocating for people experiencing homelessness are partnering with landlords rather than having potentially adverse relationships.”
While every case may not be successful, he said this program will provide a safety net for landlords who want to be part of the solution.
“Hopefully, 9 out of 10 cases are successful and that’s great,” he said, “but even in that 10th situation, when the person themselves is not successful, the landlord is still covered.”
