CHICAGO (NewsNation Now) — Data from the American Housing Survey estimates nearly 43 million housing units in America are home to renters. Typically landlords charge a security deposit, but in some cities and states the laws are changing .
Before the COVID-19 pandemic, a Career Builder survey from 2017 showed 78 percent of American workers lived paycheck to paycheck.
“It creates a burden, a real financial burden,” said RentSense CEO Tim Wahl.
Wahl believes that burden is being made worse by the pandemic.
“Since COVID has reared its ugly head, more people are hurting,” Wahl said.
Wahl is working with landlords to lessen the hardship caused by the steep costs of security deposits. According to Wahl, the average rent in the U.S. is $1,500 a month. Depending on where you live, tenants can pay between one to three times that.
Wahl believes there’s a better solution.
“That return to renter program has generated a ton of interest,” Wahl said.
Before signing a lease, Wahl recommends tenants look for properties that offer a return to renter program insurance policy.
“It’s actually like a mini stimulus for people who need it,” Wahl said.
Instead his customers can pay a one-time premium of 25% of a month’s rent. Wahl said it allows renters to get their deposit back if they’re furloughed or lose their job.
“It’s buying a product, and whether it’s one- or two-thousand dollars, they can have that money back in their pocket when they most need it,” he said.
The issue is getting attention in cities and states across the country. In January, Cincinnati became the first city to require landlords to accept alternatives to a cash deposit. In September, lawmakers in Virginia submitted a bill to give tenants options for how they pay deposits.
Wahl predicts the trend isn’t going anywhere.
“It’s coming, you go from California, Pennsylvania, North Carolina, Virginia, where ever. This is going to take over the cash security deposits,” Wahl said.