By Attorney Heiner Giese

Dawn Anastasi, RPA Board member, alerted us to this announcement about new “tenant protections” by the Federal Housing Finance Agency (FHFA).

These tenant protections apply to multifamily properties where the loan application was submitted after the policy effective date, February 28, 2025. So it would not apply to owners who have existing federally-financed mortgages.

Note in particular the provision requiring a 5-day grace period for rent payments. Owners will not be allowed to charge a late fee during this grace period. This is also going to affect Wisconsin law regarding 5 and 14 day notices for nonpayment. For example, assume the lease says rent is due on the first. Assume the owner has a clause imposing a late fee after the 5th.

Say the tenant hasn’t paid for July, the owner has let it slide without issuing a 5-day notice and now August 1st rolls around without a payment and the owner wants to do a 5-day notice and then go ahead promptly with an eviction filing.

The owner will have to wait until August 6 to issue the 5-day.

If the tenant is month-to-month the 14 day notice without a right to cure is always effective where the tenant has behavior problems or is chronically late and the owner just wants them to move – a 14 day notice could be used effectively as of the 2nd or 3rd day of the month if no rent was paid. But now owners would have to wait at least 5 days before serving the 14 day notice.

Finally, if an owner has a per diem type of late fee, the first 5 days of delinquency couldn’t be charged.