We have summarized some of the key provisions, challenges and the impact it may have on your employee population of renters moving to New York.
  • Application fees may no longer be charged and fees for background checks and/or credit checks are limited to the actual cost of the service or $20, whichever is less.
  • Security deposits and any upfront rent cannot exceed one month’s rent each
  • Move-out inspections must occur no earlier than two weeks and no later than one week prior to the end of the end of the tenancy.  An itemized statement specifying any damage must be     provided along with an option for the tenant to make the repairs before the  end of the tenancy.
  • Landlords must return the security deposit within 14 days of the tenant’s departure, along with an itemized statement indicating the basis of any deductions from the deposit. 
Impact on Mobility
Generally, landlords in NYC require rental applicants to have good, established US credit with a gross income of 40 to 45 times the monthly rent.  As an example, a monthly rent of $3,000 would require a gross income of at least $120,000. Previously, international assignees with no US credit history or those whose income did not meet the income eligibility requirement were able to pay rent in advance or provide a larger security deposit. The new restrictions on upfront rent and deposits eliminate this as an alternative.

Options for Assignees
Based on the new provisions, the following options are available to your assignees inbound to NYC. 

  • If the assignee has a family or a relative currently living in the US, an individual guarantor or co-signer can be used to secure a rental. However, they must have a gross income of 80 to 90 times the monthly rent.  Using $3,000 as the monthly rent, the guarantor’s income would have to be at least $240,000.
  • The assignee can use a guarantor company, such as Insurent or The Guarantors.  Typically, they charge an upfront, non-refundable fee dependent on the length of the lease and the risk     assessment of the applicant.  Generally, this fee is between 85% to 120% for a one-year lease. This fee can then be reimbursed to the assignee.
  • Depending on the length of an assignment, you may offer a corporate signed lease or an already established corporate apartment where you are responsible for the lease terms and rent payments on behalf of the employee.  
  • Discuss with the assignee the feasibility of living in New Jersey or Connecticut where the tenancy laws are less restrictive. 
Best practice is to assess your mobility program and policies to determine coverage provisions.  Ideally, the options extended will be the ones that best align with your policy.