Does your landlord know where your stimulus check is? Unfortunately, the answer may be yes.
Armed with your personal data such as Social Security numbers and birth dates, creditors can find out the status of your stimulus payment online using the Internal Revenue Service’s “Get My Payment” tool.
Consumer advocates worry this could hurt your chances of negotiating a mortgage forbearance or rent deferral if you’re facing financial hardship because of the coronavirus pandemic.
“There have absolutely been instances where not just landlords, but a range of creditors, are finding it pretty easy to learn if someone has gotten the stimulus checks,” said Deena Merlen, a partner with Reavis Page Jump, a New York law firm. “Landlords may not take time to read the huge letters with exclamation points that the [IRS payment tracker] is for authorized use only.”
The concern also comes at a time when the coronavirus relief legislation, called the CARES Act, prohibits lenders or loan servicers from foreclosing on eligible homeowners for a 60-day window period starting March 18, and allows forbearance for government-backed mortgages.
Renters, on the other hand, haven't received uniform protection, but some states, such as New Jersey and Florida, have taken their own measures to postpone evictions.
‘So I can close the books out for April’
One example concerns a tetexchange between an Oregon landlord and his tenant shared on Twitter that was retweeted 26,300 times. The landlord admitted he checked on the status of stimulus payments for some of his renters to see if they could meet rent.
“So are you going to be making a payment towards rent?” the landlord asked. “So I can close the books out for April.”
If a tenant sued their landlord, Merlen said there could be financial consequences for the landlord.
“For example, the penalties could potentially be the sum of the actual financial damages the plaintiff has suffered plus punitive damages,” Merlen said, “Or $1,000 for each unauthorized inspection or disclosure, if that adds up to a greater amount, plus the cost of bringing the civil action to district court, and reasonable attorneys’ fees.”
‘No language that addresses the lines of creditors’
While the IRS website discourages unauthorized use and lawsuits could punish creditors, Merlen adds the CARES Act hasn’t done enough to prevent misuse of information.
“Unfortunately under the CARES Act, there’s no language that addresses the lines of creditors that seek to garnish those payments,” Merlen said. “There’s been a lot of advocacy efforts to address what has been considered that gap.”
For instance, New York State Attorney General Letitia James issued official guidance on Saturday to New York State banking institutions, creditors, and debt collectors, making clear that stimulus checks were exempt from garnishment under state law.
“This official guidance makes clear that banks and debt collectors cannot freeze or seize stimulus funds that are on their way to New York families,” said Attorney General Letitia James in the memo, “and any institution that violates this guidance will face swift legal action from my office.”
Illinois Gov. J.B. Pritzker last week suspended laws that permit garnishment summons, wage deduction summons, or a citation to discover assets as part of debt collection proceedings.
‘Know you’re starting on a level playing field’
If you find out your landlord, debt collector, or other creditor has accessed your stimulus check status, seek legal advice, but notify them afterward.
“I think you should make the landlord aware you are talking to a lawyer and are willing to exert your rights,” said Keri Norris, chief legal officer at LegalShield, an online legal services company. “You want to make the other party know you’re starting on a level playing field.”
Consider filing a complaint to your state attorney general’s office as well.
“The best strategy is to publicize the fact to your landlord and creditors that this is an unauthorized access that can subject them to penalty,” Merlen said. They’re “basically admitting to [being] a crook.”