Unpaid Bills At 60 Unit Building In Foreclosure Leave Tenants Dealing With Accumulated Trash, Periodic Water Shutoffs

In Alton, Illinois, The Telegraph reports:

• Sanitation workers Monday cleared away more than a month's worth of garbage that overflowed large trash receptacles at Belle Manor apartments and disgusted its tenants. "It's a mess out here; it is ridiculous," said one of two tenants who called The Telegraph in recent days to complain about the mountains of smelly trash. "It's horrible. I've been here three years, and it has never been like this." [...] She claimed no one had picked up garbage at the privately owned complex of 60 units since "right after Thanksgiving.

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• In what could be related to the problem, records at the Madison County Courthouse show the 60-unit complex [...] is in foreclosure.

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• The lack of trash pick-up is only the latest of Belle Manor's tenant woes. In September 2007 and July 2008, tenants suddenly lost water service with no warning. The first time, the water was off for more than seven hours. [...] Tenants' faucets then unexpectedly went dry 10 months later on July 17, when the complex's owner failed to make a timely payment on a $7,120 city sewer bill. One of the tenants said that shut-off, in 90-degree-plus heat for about 26 hours, was the fourth such time in the three years she had lived at Belle Manor.

For more, see Taking out the trash (Piled-up garbage removed from Belle Manor). ThetaTenantRentSkimming

Fannie To Extend Moratorium On Foreclosure Evictions; Freddie Mum On Further Action

The Wall Street Journal reports:

• Fannie Mae is finalizing a national policy that will allow tenants to remain in their homes even if their landlord goes into foreclosure -- a landmark decision for tenants. The policy will be in effect Jan. 9, Fannie Mae said Sunday, and reflects growing pressure on the mortgage company from a legal-aid group that threatened to sue over recent evictions. The company said it will also ensure its current holiday moratorium on new evictions is being followed until the new policy takes effect.

***

• In late November Fannie Mae and Freddie Mac said they would suspend tenant evictions temporarily during the year-end holidays. [Connecticut legal aid firm] New Haven Legal Assistance said that despite the pledge, Fannie Mae was proceeding with more than a dozen new eviction cases in Connecticut. The advocacy group said the evictions would violate legislation passed earlier this year to rescue the two mortgage-finance giants that required them "to permit bona fide tenants who are current on their rent to remain in their homes under the terms of their lease."(1)

• In his letter Sunday to the New Haven group,(2) Fannie Mae General Counsel Curtis Lu wrote: "As far as we know, this will be the first nationwide program of its kind." [...] Freddie Mac hasn't announced a similar policy reversal, though a spokesperson said they are "currently evaluating additional actions."

For more, see Fannie Mae to End Tenant Evictions in Foreclosures.

(1) Section 109(b) of the Emergency Economic Stabilization Act of 2008 may require the U.S. Secretary of the Treasury to work with the F.H.F.A. and other government entities to permit tenants in foreclosed homes to remain in their apartments after foreclosure.

(2) Fannie Mae General Counsel Curtis Lu was responding to a December 8, 2008 letter sent by New Haven Legal Assistance, demanding that FNMA immediately cease violating Section 109(b) of the Emergency Economic Stabilization Act of 2008. ThetaTenantRentSkimming

Legal Aid Effort In Connecticut Has Nationwide Effect As Fannie Persuaded To Reverse Course On Foreclosure Evictions; Freddie Expects To Follow Suit

In Hartford, Connecticut, The Hartford Courant reports:

• What began with a single mother in Hartford fighting her eviction has led to a policy change by Fannie Mae allowing renters to remain in their homes after their landlords are foreclosed on, a switch that could help thousands of renters across the country.

***

• Legal Aid lawyers in Hartford — and subsequently, New Haven — began fighting tenant evictions by Fannie Mae in Housing Court after Congress passed a financial market bailout bill containing provisions protecting tenants in good standing from eviction.

***

• The [Emergency Economic Stabilization Act of 2008] applies to federal agencies that control mortgages. Legal Aid lawyers argued that provisions in the law(1) pertained to both Fannie Mae and Freddie Mac because they were taken over by the federal government. The policy change — Freddie Mac said Monday it expects to follow suit — will have vast implications for renters because Fannie Mae and Freddie Mac guarantee or own half of the country's residential mortgages, which apply to buildings that house one to four families.

For the story, see Hartford Renter's Fight Leads To Fannie Mae Policy Change (Renter Wins Fannie Mae Fight) (if link expires, try here).

See also:

• New Haven Independent: Foreclosure Evictions Halted.
• The Wall Street Journal: Fannie Mae to End Tenant Evictions in Foreclosures.

(1) See Section 109(b) of the Emergency Economic Stabilization Act of 2008, which, they argue, requires Fannie Mae "to permit bona fide tenants who are current on their rent to remain in their homes under the terms of their lease." ThetaTenantRentSkimming

Oakland Moves To Protect Renters From Utilities Shutoffs In Foreclosed Rental Properties

In Oakland, California, KGO-TV Channel 7 reports:

• The City of Oakland announced a new plan to help renters who face the shut-off of their heat and electricity this winter because the building they live in has been foreclosed. During a Monday morning press conference Oakland officials announced the details of a plan meant to protect people who were suddenly blindsided by their landlord's foreclosure and left with no services.

• Now, they are not only going to get notice but they will also get some time to deal with it as well. The City of Oakland is declaring that shutting off water, heat or electrical services at rental properties poses a threat to public health and safety.

***

• The city began looking into this after hearing some horror stories about rentals ending up in the hands of banks that have discontinued services sometimes without any warning at all.

For more, see Plan protects renters facing foreclosure (A new declaration makes it illegal to shut off utilities in multi-unit buildings). ThetaTenantRentSkimming

NJ To Crack Down On Tactics Used To Illegally Intimidate Tenants Into Moving From Foreclosed Buildings

In Newark, New Jersey, The Jersey Journal reports:

• On the heels of recent stories in The Jersey Journal about tenants being forced out of buildings going through foreclosure, state officials announced [Tuesday] several steps they are taking to combat the illegal practice.(1)

• At a press conference in Newark, New Jersey Public Advocate Ron Chen said landlords who force tenants out without a legal eviction order face both civil and criminal charges. Under state law, a landlord who does that can be arrested as disorderly person.

• "This is a tragedy," Chen said. "Folks don't know it, but they don't have to leave." State Banking and Insurance Commissioner Steven Goldman said tenants are being forced out because many lawyers, real estate agents, mortgage lenders, police and judges also are unaware of the 2006 law.

***

• Earlier this month, The Jersey Journal wrote about a "cash for keys" scheme two property owners were using to get Hudson County tenants to leave buildings going through foreclosure. The tenants were sent notices implying they had to leave and were offered money to facilitate their move.

For more, see Following Hudson County's lead, state to crack down on owners trying to evict tenants in buildings going through foreclosure.

See also, The Star Ledger: State says landlords in foreclosure cannot evict tenants. ThetaTenantRentSkimming

Las Vegas Family Of Four Gets Screwed Over In Lease-Purchase Of Home In Foreclosure

In Las Vegas, Nevada, the Las Vegas Review Journal recently reported the story of a family of four who had relocated from Hawaii, and who had entered into a lease-purchase agreement for the purchase of the family home. Unbeknownst to the family, the home was in foreclosure.

For the rest of the story, see THE FACES OF HARD TIMES: 'We put our trust in people' (Alleged scam involving lease-purchase of foreclosed home sends family back to Hawaii). ThetaTenantRentSkimming rent to own lease purchase option scams yellowstone

Boston Legal Aid Firm Wins $54K Jury Verdict For Tenant Illegally Booted In Foreclosure Eviction; Now Seeks Triple Damages, Attorney Fee From Servicer

In Boston, Massachusetts, The Boston Globe reports on William Allen, a local man who, with the help of local law students at Harvard Legal Aid Bureau, fought back against a mortgage loan servicing company in a case involving an illegal foreclosure eviction.

• [I]n January, after the Bank of New York, which owns the property, sent an eviction notice, Allen fought back. He filed a counterclaim, arguing that by changing the locks the bank tried to paint him as a squatter and that it intentionally did not turn on the water and heat, because it wanted him to leave.(1) Last month, after a three-day trial in Boston Housing Court, a jury awarded Allen $54,000 for his ordeal.(2)

***

• Lawyers at the Harvard Legal Aid Bureau, which represented Allen, say that it's a rare victory for a tenant in a post-foreclosure case and that the verdict has caught the interest of legal services groups nationwide.

• "The impact of this case is that the banks now know that if they engage in extrajudicial practices to gain possession of a foreclosed property it can cost them dearly," said Verner Moore, a lawyer and clinical instructor at the Harvard Legal Aid Bureau.

For more, see Vindication after eviction ordeal (Jury backs tenant in foreclosure dispute).

Go here for more on the law students at the Harvard Legal Aid Bureau urging tenants in foreclosed homes to fight back against careless/reckless mortgage companies seeking illegal evictions.

(1) The story states that, after experiencing a loss of heat and water to the premises, Allen turned to WilmerHale Legal Services Center in Jamaica Plain - one of two legal services programs run by Harvard. A law student reportedly fired off a letter to the Bank of New York, saying that Allen lived there and urging the bank to get the heat and water turned back on. Allen alleges that the bank instead changed the locks and sent police after him.

(2) Reportedly, the case is not over. A hearing is a set for Jan. 30, when Allen's lawyers will ask a judge to double or triple the award because, they contend, the bank willfully and knowingly failed to act responsibly as a landlord. They will also seek attorneys' fees. ThetaTenantRentSkimming ForeclosureLockOuts

No Heat, Hot Water For 18 Cincinnati Families Living In Building Facing Foreclosure

In Cincinnati, Ohio, WLWT-TV Channel 5 reports:

• It's going to be a cold Christmas for 18 families in Avondale because their furnace has been broken for three months and the soonest it'll be fixed is New Year's. "It’s just real cold in this building, but we survive. To us, we're all right. We leave the oven on all night,” apartment resident Lake McCowan said. The McCowan family said they've been forced to boil water and leave the oven on all night.

• They know it’s a fire hazard, they even have a scorched floor to prove it, but they said they don’t have a choice. They said the building's owner hasn't paid his mortgage in about six months and as it heads into foreclosure [...].

For more, see Avondale Apartment Complex Hasn't Had Heat In Three Months (Families Keep Ovens On, Use Space Heaters To Stay Warm). Go here for WLWT-TV video. ThetaTenantRentSkimming

Rent Scams Hitting Northern Virginia

In Northern Virginia, The Washington Post reports:

• [I]n the past 18 months, the foreclosure debacle has pushed tens of thousands of area residents into the rental market, many with crippled credit and a desperate need for housing. Waiting for them is a new cast of swindlers, cheats and real estate sharks ready to prey on the weak and needy. Scams of various stripes are thriving in the foreclosure mess and flourishing at the margins of landlord-tenant laws.

***

• Collecting money on a property you no longer own or signing a long-term lease on a property headed for foreclosure could lead to felony charges of obtaining money under false pretenses, authorities said.

***

• In recent months, [Kristi] Cahoon, [an attorney with Northern Virginia Legal Services] said her office has been swamped with so many calls about rip-offs and scams, "they don't even faze me anymore." Police in the region do not specifically track fraud or theft cases that stem from rental housing, so the trend is difficult to chart.

For more, see Foreclosure Epidemic Infecting Rental Market (Tenants, Lenders Are Exposed to Various Scams). ThetaTenantRentSkimming

Utilities Shutoff In Rental Building Facing Foreclosure Force Tenants To Take Over Landlord's Unpaid Bills

In Miami, Florida, The Miami Herald reports:

• [M]ore than once over the past year, tenants of [a recently abandoned and in foreclosure] 11-unit Liberty City complex had come home to find the water shut off. Eventually, they stopped paying rent and took the matter into their own hands, forming a kind of rudimentary condo association to manage the property at 1575 NW 69th St.

• South Florida's foreclosure crisis is creating unique hardships for renters in some apartment buildings. Unlike tenants of condos and houses, apartment dwellers rely on landlords to collect garbage, keep up the premises and make repairs. The cost is included in the monthly rent.

• So when a landlord enters foreclosure, those services often stop, leaving residents without vital utilities and sometimes in unsafe conditions. They may be forced to move. Low-income renters sometimes have nowhere to go.

For more, see Foreclosure crisis creates unique hardships for apartment renters (South Florida apartment renters can face grim living conditions when their landlords enter foreclosure and stop paying bills. Some are taking matters into their own hands). ThetaTenantRentSkimming

Despite Intimidating Letters To The Contrary, NJ Tenants Have Protection From Foreclosure Eviction

In Jersey City, New Jersey, The Jersey Journal reports on the growing practice by real estate agents and others of sending intimidating letters to renters in foreclosed homes in attempts at forcing them to move, despite New Jersey law protecting them from foreclosure eviction.

• The notices the two renters received are typical of the shady "cash for keys" deals being pushed on tenants in foreclosed buildings throughout Hudson County. In each case, a lump sum is offered in exchange for the tenants agreeing to vacate the property [...].

• But when [the tenants] turned to Jorge Aviles, a former councilman and attorney for the Housing Resource Center in Jersey City, he told them they did not have to move because New Jersey law protects tenants from eviction in foreclosure actions.

• Aviles said the "marginally legal" notices are frightening people, especially seniors, who are not aware of their rights. [...] "This is an attempt to trick people into thinking the foreclosure has some impact on them," Aviles said, adding that in his 27 years as a lawyer, he's "never seen stuff like this."

For more, see Shady letters tell tenants to leave now.

See also: Officials acting to protect tenants:

• [T]he notices, which are popping up more often in Hudson County and other areas hit hard by foreclosures, tell the tenants they will be kicked out if they do not take cash to vacate their apartments, despite a state law that forbids such evictions. ThetaTenantRentSkimming

Nix "Cash For Keys" Deals & Fight Lenders In Court Instead, Say Boston Law Students To Area Tenants Facing Foreclosure Eviction

In Boston, Massachusetts, The Harvard Crimson reports on a group of Harvard law students who are encouraging tenants in foreclosed homes to refuse "cash for keys" offers from lenders and fight foreclosure evictions in court instead.

• [W]orking at the Harvard Legal Aid Bureau, [third-year law students Nicholas J.] Hartigan and [David E.] Haller have long represented tenants against banks, but when they realized less than half of foreclosure [eviction] cases reached the courts, they knew they needed to go out and find the missing tenants.

• Along with Anthony B. Borich, a third-year Law School student, they started No One Leaves, an organization of individuals who canvass different zones of Boston. Each week this fall, they and an army of volunteers, including some College students, have been visiting foreclosed homes, knocking on doors, and telling residents to stay put. [...] “The idea is to give these people a heads-up before those damn cash-for-keys people get there,” Hartigan says [...].

***

• The bank that has seized the property must now go through the full eviction process. According to Hartigan and Haller, every tenant can expect a much larger payment through this process while staying in his or her home without paying rent.

***

• As members of the Legal Aid Bureau, Hartigan and Haller act as legal counsel to many tenants of foreclosed properties, sometimes winning settlements that represent a significant percentage of the property’s original price. Haller—who recently represented a tenant who lost heat, water, and access to his home after the bank changed the lock on the door—says that juries tend to be sympathetic to his clients. In this case, he was awarded over $50,000 for emotional distress and for the diminution of value of the property, and Haller says that there is a “good possibility” that sum will be doubled or tripled.

For more, see ‘No One Leaves’ Keeping People Put.

********************

In a related story, The Boston Globe reports:

• The administration of Governor Deval L. Patrick said [this week] that it has issued a brochure outlining the rights and responsibilities of Massachusetts renters living in foreclosed buildings.

For more, see New foreclosure brochure outlines renters' rights.

For the online version of the brochure, see Tenants Rights: What Tenants In Foreclosed Properties Need To Know.

See also, MassLegalHelp: If Your Building is Being Foreclosed, Don’t Fall for “Cash-for-Keys” Schemes.

Go here for more on the law students at the Harvard Legal Aid Bureau urging tenants in foreclosed homes to fight back against careless/reckless mortgage companies seeking illegal evictions. ThetaTenantRentSkimming

Property Manager Arrested On Suspicion Of Pocketing Rents Without Paying Bills, Leaving Properties Facing Foreclosure, Tenants Without Utilities

In Visalia, California, the Visalia Times Delta reports:

• The owner of Moreno Property Management in Visalia faces possible felony embezzlement charges. Sylvia Gonzalez, 25, of Visalia, is suspected of collecting rent money and utility payments for properties throughout Visalia and then not making the payments, detectives with the Visalia Police Department said.

• In some cases tenants in properties managed by her firm lived without electricity and gas, police said. Gonzalez is suspected of fraudulently obtaining bank accounts and forging paperwork to convince property owners that the bills were being paid. The crimes were discovered when some of the properties went into foreclosure, police said. She was arrested Thursday. The extent of the loss and the number of victims is being investigated.

Source: Owner of Moreno Property Management arrested for embezzlement. ThetaTenantRentSkimming

Tenant Intimidation Continues In SF As Renters In Rent-Controlled Foreclosed Buildings Often The Targets Of Illegal Eviction Attempts

In San Francisco, the San Francisco Chronicle reports:

• [S]ome renters are being told that if their landlord defaults on the mortgage during this foreclosure crisis, they must move out - even if they've been making their rent payments on time. The fact is, in San Francisco that is simply not true.

• "Tenants in rent-controlled buildings in San Francisco are protected by the need for a 'just cause' for eviction," said Darlene Wolf, executive director of the rent board. "And foreclosure is not just cause."

• To make that point, the assessor's office will send letters to tenants in buildings that are in default. The letter will say, "According to San Francisco law, it is illegal for the new owner (typically the bank that has foreclosed on the loan) to ask you to leave without just cause or shut off your utilities." The hope is that the letter will help stop the unsavory practice of intimidating tenants into vacating.

For more, see Renters' eviction notices often illegal in S.F.

For other posts involving the problems tenants face in homes in foreclosure, go here, go here, go here, go here, go here, and go here. ThetaTenantRentSkimming

Landlord Foreclosure Forces Tenant Family Of 10 Out Into The Cold

In Chicago, Illinois, WLS-TV Channel 7 reports:

• The foreclosure crisis has forced a Chicago couple and their eight children into homelessness. [...] The Chambers family said they were renting in a [3-unit] building in Chicago's Lawndale community. They say they were forced to leave their home when it was abandoned by the landlord as it fell into foreclosure.

• After the landlord walked away, [Antoinette] Chambers says the water pipes were stolen from the building, then the drug dealers showed and began to the occupy the porch area and a vacant apartment. "I tried to get some help from charity and the city and didn't get answers," Chambers said. Chambers says the city could not help because she was never served with official eviction papers.

• To make matters worse, last week, Chambers sent some of her kids to their aunt's home in Englewood for a hot meal and place to sleep. Twelve-year-old Dishawn ended up being shot in the arm.

For the story, see Foreclosure forces family of 10 out of home.

For other posts involving the problems tenants face in homes in foreclosure, go here, go here, go here, go here, go here, and go here. ThetaTenantRentSkimming

City Kicks 53 Residents Out Of Residential Hotel In Foreclosure As Power Shutoff Creates Fire Hazard; At Least 24 Kids Among Those Getting The Boot

In St. Petersburg, Florida, the St. Petersburg Times reports:

• When the electricity in their residential hotel was turned off the morning before Thanksgiving, Mary Mix and her three children scraped together money to buy candles. During the next few nights — some of the most frigid this winter — they piled under blankets to stay warm.

• Then on Monday, city officials shuttered the hotel that Mix and more than a dozen other families, including at least 24 children, had called home. City officials said the lack of electricity [...] created a fire hazard. The hotel's water also was about to be shut off. Officials said the hotel owners owe $90,000 in back utility bills.

• A total of 53 people were forced out. They had to be gone by 5 p.m. Wednesday. Most of the last dozen or so families to leave were single mothers and their kids. Instead of focusing on preparing for the holidays, they were scrambling to find a new place to live.

For more, see No heat, no lights, then no home in St. Petersburg.

For other posts involving the problems tenants face in homes in foreclosure, go here, go here, go here, go here, go here, and go here. ThetaTenantRentSkimming

New Los Angeles Ordinance Prohibits All Tenant Foreclosure Evictions Until Property Is Sold To New Owner

In Los Angeles, California, CBS2 reports:

• Renters whose residences have gone into foreclosure cannot be evicted until the property is sold to a new owner under a city law signed Friday by [Los Angeles] Mayor Antonio Villaraigosa. The one-year ordinance, spearheaded by Council President Eric Garcetti, will impact 300,000 apartment buildings and single-family homes. [...] Renters [in Los Angeles] who are being evicted as a result of foreclosure were urged to contact the city's Housing Department at (866) 557-RENT.

For the story, see Mayor Passes New Rental Foreclosure Law. ThetaTenantRentSkimming

100s Of Iowa Tenants To Get The Boot As Buildings In Foreclosure, Maintenance & Utility Bills Financially Choke Landlord; Consequences Concern Cops

In Sioux City, Iowa, KCAU-TV Channel 9 reports:

• Hundreds of renters in Sioux City are being told to move because of financial and legal problems facing their landlord. The landlord, KJM Incorporated, also known as Meyer Company, is being taken to court for nearly $1 million in unpaid mortgages.

• Tenants [...] were told on Wednesday they would need to move out by February 7th. The notice says because of unresolved maintenance issues and high utility bills the company can't afford pay, all tenants must relocate.

***

• "It's disgusting," said [one tenant]. "[There are] cockroaches everywhere. The floors, the walls are caving in. The ceiling, the only thing holding my ceiling up is a piece of plywood. It's unhealthy especially when you have asthma and a brand new baby on the way."

For more, see Hundreds Forced To Move As Landlord Taken To Court.

In a related story, see Police, Renters Wonder What Will Happen Next:

• [K]JM Incorporated and owner Duane Meyer are closing dozens of buildings in Sioux City after he says high utility and maintenance costs got the best of him. Now tenants are wondering what to do, while police are concerned about how they will monitor so many vacant buildings. [...] Captain Melvin Williams with the Sioux City Police Department says having so many buildings become vacant at once will be a major concern.

For story update (1-28-09), see Some Tenants Now Told They Can Stay.

For other posts involving the problems tenants face in homes in foreclosure, go here, go here, go here, go here, go here, and go here. ThetaTenantRentSkimming

New Minnesota Laws Offer Protection For Tenants In Foreclosed Homes

In Minneapolis, Minnesota, Minnesota Public Radio reports:

• [T]housands of renters in Minnesota are living in foreclosed properties and the state has already tried to ease the burden on them by passing a set of laws designed to protect renters' rights. And so far, it seems to be working.

For more, see Are laws protecting tenants in foreclosure working? ThetaTenantRentSkimming