WATCH OUT FOR SIDE DEALS

(Article published in HWW May 2008)

“I keep telling my clients, ‘Don’t be forced into accepting side deals.’” says Tanya Williams, who helps families at St. John’s Place Family center find permanent housing. “This is becoming more and more of a problem.”

Like Housing Specialists in shelters across the city, Ms. Williams is fighting an uphill battle. Landlords offer leases to tenants in the Work Advantage and Fixed Income Advantage subsidy programs and working Section 8 because they have income and can pay the rent. But some of these landlords want more than the official lease stipulates. They persuade the tenants to sign a separate agreement – a “side deal” – to pay more than the legal rent.

The side deals are against the law. According to the Department of Homeless Services and the Legal Aid Society, landlords charging more than the rent specified in the lease are breaking the law. The side agreements cannot be enforced in court. Tenants who pay extra money in side deals may be able to get it back in court.

Families who are eager to move out of shelter may not think they are risking anything by signing side deals.

But the potential danger to the tenant is real. Ms. Williams tries to make them face up to it: “Say, you agree to a side deal to pay the landlord $200 or $300 extra a month. You can be putting yourself in a financial bind. If you have Work Advantage, you will have agreed to pay $50 of your own money toward the rent. You’ll have to put aside in a savings account between 10 and 20% of the value of the rent. If the rent were $1300, you would have to save $130 to 260 a month. On top of that you have to pay for utilities.”

Changing your mind later may not be an option. As Legal Aid points out, landlords may retaliate against people who decide not to not pay a side deal amount, by harassment or refusing to renew a leave in an unregulated building.

If you have legal questions regarding a side deal, call Joshua Goldfein at The Legal Aid Society at (212) 577-3414 or David Robinson at Legal Services NYC at (646) 442-3596.