Closing Discounts for Vaccinated Borrowers, and Other Stories

A year and a half has passed since the major 2020 workplace interruptions. And here we are. Still grappling with the health and economic threats from Covid — especially its delta variant.

The Biden administration wants fully vaccinated adults to receive a Covid-19 booster shot as soon as scientists give the go-ahead. And, as announced in a presidential address to the nation on September 9, a vaccine mandate now applies to some two-thirds of all U.S. employees — those employed by businesses with a workforce of 100+.

As expected, the directive is drawing scrutiny and controversy. Yet the National Association of Manufacturers calls vaccines an economic imperative. Amazon has voiced support for the mandate. Facebook and Microsoft say they already require the vaccines for their office staff.

Among the growing number of entities requiring staff vaccinations are Saks Fifth Avenue, the New York Stock Exchange as well as several major banks, the City of New Orleans (for all public events), CNN and Fox News, Twitter, Google, Uber and Lyft, Tyson Foods, Walt Disney and United Airlines. Recent polls show 52% percent of U.S. workers support vaccine mandates, with 29% strongly opposed.

Vaccine requirement decisions have also entered the real estate sphere. Here, we review some notable news from the industry.

Mortgage Lender Offers Vaccine Incentives

Neat Loans, a digital home loan company sporting a tagline Mortgage Without the Mess, now gives cash incentives to applicants who’ve been inoculated against Covid-19. Home mortgage or refinancing applicants who present digital photos of their vaccine cards get a $500 discount at closing. Some 80% of vaccinated borrowers have taken the rebate since it launched in mid-August 2021, says the Colorado-based fintech firm.

What’s the corporate purpose behind the $500 incentive?

A borrower’s vaccine status is connected with employability. With the new mandates announced on Sep. 9, that’s a stronger point than ever. Employability and job status is a key part of loan approval, and it’s very important for years after the loan is issued.

Further, the company says this about its vaccine incentive:

We believe Neat is the first financial services company to offer a substantial $500 discount to our applicants who have received a Covid-19 vaccine. Beyond being the responsible thing to do, vaccinated individuals are going beyond taking care of their own health — they are making a crucial impact on the wellbeing of our community. 

It’s a socially conscious sentiment. But is Neat veering out of its lane here? Is it discriminating against those who cannot have the vaccine? Anticipating the question, Neat offers the same closing credit to unvaccinated borrowers who declare an inability to take the shot on account of health or religious factors.

Real Estate Companies Mandating the Covid Vaccine

All types of companies are involving their lawyers, their human resources specialists, and health and safety consultants while deciding between a range of carrots and sticks that could best fit corporate needs, culture, and employee well-being. These companies must be prepared to handle religious and health accommodation needs, pay coverage for the trips to vaccination sites, understand data confidentiality issues, and so forth.

According to published guidance from the Equal Employment Opportunity Commission (EEOC), federal law allows companies to insist that their workers are vaccinated before reporting to their work sites. Workers who reject vaccinations on account of health or religious factors must, in some cases, receive reasonable accommodations. The EEOC’s guidance is of interest, but it can only speak to federal employment laws. State and local laws are separate creatures. As for states, only Montana actually bars employers from establishing mandates.

Some real estate companies, after considering the law and policy issues, have instituted firm requirements for their employees to be vaccinated. A leading example is Redfin, where office workers must have Covid-19 shots, and employees who are not fully vaccinated must work remotely — at least while the infection rates are high.

Redfin has solid business reasons, as well as health concerns, to support vaccine uptake. Surveys of homeowners show that people are more interested in placing their houses on the market and more willing to move to new homes in an environment of widespread vaccine distribution.

Unsettled Areas: Multi-Unit Properties and Vaccination

What about multi-unit properties? Wherever people live in close quarters and share amenities, associations may establish certain sanitation regimens. They may also publish health-related rules, limiting the capacity of shared areas, or requiring the wearing of masks. Some have their employees show proof of a negative Covid test after international or interstate travel.

Condo associations, and at-will employment settings generally, could require vaccination for employees as well. “At minimum, associations should provide vaccine-related educational forums and updates to encourage vaccination,” David Podein, Jonathan Goldstein and Deesha Smart wrote in a March 2021 commentary in the Law.com Daily Business Review.

As vaccines are now readily available and free, can condo associations require vaccination for those 12 and older, even beyond the population they directly employ? Any such rules would need to be “carefully considered with legal counsel and narrowly tailored,” the lawyers write.

As for apartment owners, the publicly listed Camden Property Trust, a real estate investment trust (REIT), has mandated Covid shots for all employees, starting in August 2021. The company expressed the hope that other landlord companies will follow their model. Camden owns and runs properties nationwide.

Airbnb-Type Lodging: Specific to Locale, Host Preferences

What about homeowners who rent out space? Rules depend on state or local rules. Looking up the Airbnb listings in Maine, for example, the prospective guest finds links to general guidance for Maine as well as travel restrictions and advisories in Maine. As government stances evolve, Airbnb suggests that guests frequently look for updates. More information is laid out at the Airbnb Help Center page.

Hosts are also taking it upon themselves to set house vaccination rules. This is particularly the case where homeowners have their own medical concerns.

In some locations, whole areas are acting protectively. Puerto Rico, which has recorded a dramatic Summer 2021 rise in Covid-19 transmission (from 1.4% up to 11%), now requires vaccination for all guests in hotels and hostels, Airbnbs, and other short-term accommodations.

In mid-August, Puerto Rico started mandating vaccinations (or weekly negative test results) for large groups of workers. A $5,000 fine, or even jail time, can be imposed on those who don’t qualify for official exemptions and refuse to follow the mandates.

Looking Ahead: Virus Protection Is Now Relevant for Home Buyers

It’s becoming clear that entities are weary of incentivizing workers and others. They are increasingly willing to require Covid shots. Those who were holdouts before the federal administration’s new mandates, as announced on Sep. 9, 2021, will find it easier to explain mandates to their workers in the months ahead.

In this environment, we can expect lenders to consider whether applicants are following the currently recommended health precautions. The matter will be part of any borrower’s assurances that they are widely employable and can be expected to pay off a major loan.  

Covid is leaving a bigger mark on real estate than most of us could have ever imagined when we first heard the name of this disruptive virus.

Supporting References

Timothy Aeppel and Jarrett Renshaw for Reuters: A Few Cheers, Many Worries Among U.S. Businesses Facing Covid-19 Vaccine, Test Mandate (Sep. 9, 2021).  

Ahmed Aboulenein for Reuters: Factbox: Biden’s New Covid-19 Plan Includes Vaccine, Test Mandates (Sep. 9, 2021).

Jackson Lewis PC for the National Law Review: Covid-19 Vaccination Considerations for the Real Estate Industry (Feb. 10, 2021).

Daniella Genovese for FOXBusiness.com: COVID-19 Vaccine: Major Companies Requiring Employees Be Fully Inoculated (updated Aug. 20, 2021).

Rick Morgan for the Puget Sound Business Journal: Redfin Pushes Back Office Reopening, Will Require Vaccinations for Returning Workers (Aug. 3, 2021).

National Association of REALTORS®: COVID-19: Guidance for Workplace Vaccination Policies.

Neat Capital Inc. (via REALTOR® Magazine): Lender Offers Mortgage Discount to the Vaccinated (Aug. 26, 2021).

Matt Carter for Inman.com: Mortgage Lender Offers $500 Discount to Applicants Who Get Covid Vaccine (Aug. 25, 2021).

Danica Coto for the Associated Press: Puerto Rico Requiring COVID Vaccine for All Hotel and Airbnb Guests (updated Aug. 16, 2021).

David Podein, et al., Daily Business Review — Law.com: Commentary — Are Condominium Associations “Immune” to Vaccine-Related Liabilities? (Mar. 30, 2021).

Katherine Feser for HoustonChronicle.com: Commercial Real Estate Firm Camden Requires Covid Vaccines for Employees (Aug. 18, 2021).

Marissa Luck for CoStar News: Major Apartment Owner to Require Property Managers, Corporate Employees Get Vaccinated (Aug. 20, 2021).

Orla McCaffrey for The Wall Street Journal: Mortgage Borrowers Who Get the Jab Face Reduced Tab (Sept. 3, 2021).

Photo credits: CDC, Roger Starnes, Sr., and Andrea Davis, via Unsplash.