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Staying Home: The Rights of Renters in Foreclosed Properties
June 10, 2010
Today’s guest post comes from Whitney Gent of the National Law Center on Homelessness & Poverty.
Even though she had been paying her rent on time, Beverly, a resident of a rental property in Ohio, came home one weekend last year to find her apartment had been padlocked, and her belongings removed. She didn’t know the building was in foreclosure, and its new owners had illegally evicted her. Forced to stay with relatives, as even her bed had been taken, Beverly became another victim of the foreclosure crisis.
Unfortunately, Beverly is not alone. Estimates show that 40 percent of families facing foreclosure-related eviction are not owners, but low-income renters.
In February 2009, the National Law Center on Homelessness & Poverty and the National Low Income Housing Coalition issued a report entitled Without Just Cause: A 50-State Review of the (Lack of) Rights of Tenants in Foreclosure. The report revealed that most states’ laws provided virtually no protections for tenants in properties that were the subject of foreclosure actions. Indeed, only two – New Jersey and the District of
Columbia – provided that tenant leases survived foreclosure.
Thanks in part to this research, the federal government has taken action to protect renters like Beverly. The Protecting Tenants at Foreclosure Act (PTFA) was signed into law by President Obama in May of last year, and it affords tenants unprecedented federal protections – including the right to 90-days notice prior to eviction or, in many cases, the right to stay in their home until the end of their lease. These protections can be the key to homelessness prevention for some families.
States are stepping up, too. Since the release of that report, 16 states have enacted new laws to protect tenants’ rights, and 21 have legislation currently pending. These actions are especially important because PTFA carries with it a 2012 sunset provision, and because the federal law does not negate stronger state protections.
But much more remains to be done. The Law Center’s new report, Staying Home: The Rights of Renters Living in Foreclosed Properties, shows that renters’ rights are still being violated across the country. New property owners (often banks) are still sometimes failing to inform or misleading renters about their rights, or even illegally evicting them. Federal and state regulators must get more involved to curb these trends, exercising their oversight of banks and working to ensure compliance with the law. And we advocates must hold these entities accountable.