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What happens if I cannot pay rent?

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If you’re having trouble paying your rent on time, it’s a good idea to talk to your landlord about it. They may agree to a reasonable repayment arrangement so that you may remain in your house. Read this article about what actually happens if you cannot pay rent in Germany.

Anyone who did not have any financial reserves during the Corona crisis could quickly have problems paying the rent. The legislature has therefore decided that residential and commercial tenants could not be terminated if they were unable to pay rent from April to the end of June due to the corona pandemic.

If it was the same for you, you have until June 30, 2022 to pay off your rent debts. For commercial tenants, further simplifications were decided in December.

What effects does Corona have on rental contracts?

Even in times of Covid-19 you have to pay rent as a tenant. If you don’t pay, you’ll be in arrears. This is dangerous because defaulting tenants risk being given notice.

During the Corona crisis, the legislature passed regulations to take the financial pressure off tenants. They apply to both apartment and commercial tenants.

Private tenants enjoy protection against dismissal

pay rent

The following applies to you as a private tenant: You enjoy special legal protection even without Corona; Your landlord always needs a reason for termination. If you don’t pay rent for two months in a row, the landlord can give notice – without notice. In order to protect tenants from losing their homes during the corona pandemic, the legislature has temporarily restricted the landlord’s right of termination (Art. 240 § 2 EGBGB).

For you this means: If you had less or no income because of the pandemic and you were therefore no longer able to pay rent from April 1 to June 30, 2020, then your landlord was not allowed to give notice. You have two years to pay back the rent arrears. If you fail to do this, your landlord’s right of termination will be revived.

Since July 1, 2020, you have to pay rent on time again because the special regulation on protection against dismissal has not been extended.

Commercial tenants – more protection in times of crisis

The following applies to you as a commercial tenant: You can already be terminated if you are only one month in arrears. If special circumstances arise, the landlord can even cancel earlier, as the Federal Court of Justice found in 2015 (Az. XII ZR 65/14).

It’s different in the Corona crisis. Commercial tenants did not risk a termination if they could no longer pay rent from April 1 to June 30, 2020 for Corona reasons. You now have two years to pay the rent arrears with interest of currently 4.12 percent.

A regulation has been in effect since December 31, 2020, which is intended to help commercial tenants in the second lockdown (Art. 240 § 7 EGBGB). Anyone who had to close their shop and whose turnover has collapsed as a result can have their rent adjusted. It is a so-called disruption of the business basis, according to the law (§ 313 BGB).

For you this means: If you had to close your business because of the lockdown, you can now approach your landlord and agree on a rent reduction with reference to the new regulation. Your negotiating position with the landlord is significantly strengthened by the regulation.

The legislature has left it open how high the reduction may be. A ruling by the Dresden Higher Regional Court (February 24, 2021, Az. 5 U 1782/20) offers you orientation: Since no one could foresee the corona pandemic and the closure of shops, the associated burdens should also be fairly distributed. For April 2020, the tenant was allowed to cut the basic rent by half.

The Karlsruhe Higher Regional Court ruled differently, which only considers a reduction to be justified if the existence of the tenant is in danger (February 24, 2021, Az. 7 U 109/20). For the judges, it was not only the decline in sales that was important, but also government aid for short-time work.

In short: Anyone who receives state aid must not make any reductions. It remains to be seen whether this argument will hold up. Because the Federal Court of Justice will review both judgments.

How can you improve your situation as a tenant?

For commercial tenants, you can try to stay solvent with the help of loans, tax deferrals or other strategies. We describe the different options in our guide to help for the self-employed.

The following applies to private tenants: Talk to your landlord if you still need a deferral after July 1st. You are not entitled to it, but at best your landlord will agree to a further deferral if you cannot pay rent due to Corona.

Maybe you also have the chance to get housing benefit. This does not cover the entire rent, but it can result in 200 euros or more. The housing benefit is not tied to any conditions, unlike social assistance.

The Federal Ministry of the Interior has currently instructed the housing benefit offices to simplify the process. You can submit your application in many cities and municipalities by email or telephone. In order to enable a quick decision, the authority should refrain from checking first-time applicants’ assets and the size of the apartment.

The income that can be expected in the next twelve months is used as the basis for housing benefit. The current income situation is used for this. More on this in the housing allowance brochure of the building ministry.

Do you have to put up with apartment visits?

You only have to tolerate a viewing by the landlord if he has a legitimate interest. For example, if your landlord wants to sell the apartment and show it to potential buyers.

The strict contact restrictions during the corona pandemic also apply again in winter. You could therefore definitely decline a viewing. In any case, you should make sure that everyone is wearing masks to prevent infection.

You can find out what you need to consider with masks in our blog article on the mask requirement.

Special Corona help for tenants in Berlin

Berlin wants to offer further assistance for tenants. Until further notice, the municipal housing associations should agree individual and accommodating solutions in the event of rent arrears, generally not issue any notice of termination due to arrears and also not evacuate inhabited apartments. The same should apply to commercial premises.


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Michelle Halterman
USA, China, South Africa and now Munich - Michelle has come a long way in the world. She is an outdoor person and loves to be in nature with friends and on her mountain bike. Or she meets up with friends for pasta, vino, cappaccino & Co.
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