On April 1, 2020, the new economic measures adopted by our government to help people and companies affected by COVID-19 have been published. Among these measures, measures were adopted regarding the rent of the habitual residence. The measures adopted can be classified into six different groups:
1. Legal eviction proceedings.
The government authorizes the suspension of legal eviction procedures during a maximum term of six months from the entry into force of the Royal Decree provided that the lessee proves to be in a situation of social and economic vulnerability derived from COVID-19.
2. Extension of the term of leasing contracts concerning habitual residence.
Leasing contracts concerning habitual residence which term end during the state of alarm, shall be extended at the requirement of the lessee for an additional period of six months.
3. Postponement of the leasing debts:
3.1. When the habitual residence is leased by a large holder or public company, the duration of the contract will be automatically extended if the lessee requests it within a month. The lessor must answer the request and choose between two options: reduce 50% of the rental price during the state of alarm and the following months (maximum four months) or grant a deferment of the rental payment (maximum four months). This postponement supposes that the lessee has to return the amount owed during the duration of the leasing contract.
3.2. When the habitual residence is leased by private individuals, the lessee in a situation of social and economic vulnerability can request, within a month of the entry into force of the Royal Decree, the postponement or a release (total or partial) of the rent. The lessor may accept or not the proposed postponement or release within 7 days. If the lessor does not accept any of the proposals, the vulnerable lessee is entitled to request financial aids program foreseen in the Royal Decree.
4. Line of guarantees for helping vulnerable lessees.
The Government has made financing lines available to banks in order to allow the payment of the lease rents by vulnerable lessees (maximum six monthly payments), with a return period of six years (that may be extended for four more years) without interest or expenses.
5. Financial aids program.
In case that vulnerable lessees are not able to recover himself from this economic situation and thus, are unable to return loans granted, the Government will directly grant to vulnerable lessees financial aids to pay back the financial aids previously granted. The aid will have a maximum amount of 900 euros by month, or 100% of the rent or 100% of the principal amount of the loan previously granted plus interest. Each Autonomous Community will decide the amount in each particular case.