Renters Have New Rights in Foreclosure
"What you don't know may be hazardous to your financial health"
May 20, 2009 is a date to remember for millions of American home renters faced with eviction through no fault of their own. PROTECTING TENANTS at FORECLOSURE ACT of 2009 (S. 896) was signed into law by President Obama, effective immediately and not expiring until December 31, 2012.
It brought a sigh of relief to this renter - and not a moment too soon. Three years ago I signed a four year lease and moved 26,000 pounds of furnishings into a lovely two story home. It is where I live and where I work. I have never missed, nor been late, on a single rental payment.
BUT, unbeknownst to me, my dear landlords stopped paying the mortgage on the home I rent from them some time ago. (Ten months ago to my best calculation.) They were using my monthly rental payments for their own personal expenses.
Most of you by now have heard of at least one person/family in the same situation. Notices are filed. Security deposits are lost. A costly and inconvenient move looms dark on the horizon. Marriages fall apart. Jobs are lost. Bankruptcies are filed. Kids are scared. Pets are abandoned. Medical expenses soar.
These are good people, not deadbeats. They work hard and pay their bills.
More notices hammered into the front door. In six different languages. Legal notices appear in the newspaper. Neighbors panic. Neighborhood values plummet. The landlord, too embarrassed to tell the truth, often blames the renter. The renter is then blamed and shunned. Kids get depressed. The goldfish gets depressed. The lawn dies. Everyone gets depressed.
The long road to finding answers/solutions begins. Hours on the phone lost in a maze of telephone trees. No real person to be found at any of two dozen different phone numbers. Press 1. Press 1 again. Press 2. Press 2 again. Back to 1.
On the Internet for hours searching for any hint of answers to a long list of questions:
1. What are my rights as a renter?
2. Do I even have any rights as a renter once the house I occupy has been foreclosed upon?
3. What happens to my security deposit?
4. How much notice will I get before I have to vacate the home I rent?
5. Will the Sheriff put my belongings out on the curb?
6. Will being served an Unlawful Detainer (Eviction Notice) hurt my credit rating?
7. Who will actually own the home I rent after the foreclosure?
8. Do I have to pay rent to anyone during this transition?
9. I can't afford to take off from work at this time; how can I move?
10. Does the California Moratorium on foreclosures include rentals?
In short, PROTECTING TENANTS at FORECLOSURE ACT of 2009 (S. 896) provides more protection to renters than any lender wants you to know. www.consumer-action.org
If you have no current lease, or are on month-to-month tenancy, you are entitled by law to receive 90-days written notice after the home your rent is foreclosed upon. Sometimes it takes 7-10 days after the foreclosure to receive a 90-day notice, sometimes it can take 30-180 days to receive a 90-day notice. YOU ARE STILL OBLIGATED FOR THE RENT during this time.
If you have a current lease, you are entitled by law to remain in your home until the lease expires. YOU ARE STILL OBLIGATED FOR THE RENT during this time.
In both cases, it may take some time for you to be informed as to where/whom you pay your rental amount. DO NOT pay the rent to the first person who comes knocking at your door. Once you are notified, check with your County Recorder to verify.
My landlords are not bad people. They are good people who made some bad decisions about the same time the financial markets fell apart. They owe $1,150,000 on a home worth about $600,000. There is no way for them to bridge that gap.
They should however, have told me of their intentions to give my home back to the bank.
More to follow.
Thank You for the Wonderful HubPages Community Love and Support!!
Earth Angel is back and flying fearlessly!! (More like kicking!!) To those of you who have emailed and asked of my whereabouts - the above answers it all!! The home I rent is being foreclosed upon this next Wednesday, July 15th!! It will be auctioned off on the Courthouse steps!! I have not had an extra moment for months!! It took me so long to track down the laws governing renters in foreclosure homes!! A new law, just passed May 20, allows me to breathe a sigh of relief!! (For the moment, anyway!!) I am soooooooooooooo happy to be back with all of you in the Awesome HubPages Community!!
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