One month after its passage at the Ridgecrest City
Council, a new law went into effect this week that will prevent banks from
evicting renters in foreclosed residential properties. This law will provide significant relief to
hundreds of tenants who have become innocent victims of the mortgage meltdown.
Many tenants in Ridgecrest, as in communities
across California, have been hit hard by a crisis they did nothing to
create. They’ve faithfully paid rent. Yet mortgages have gone unpaid, their homes have
gone into foreclosure, and many renters have been needlessly displaced.
“In Ridgecrest, tenants mobilized, brought their
stories to the City Council, and diligently pushed the Council to take action. A majority on the Council responded to the
crisis and did the right thing by passing a law that provides sorely needed
relief to tenants while preventing unnecessary
vacancies and blight in the community,” said Andy Blue, an organizer with
Tenants Together.
Tenants Together has created a “Know Your Rights”
fact sheet for Ridgecrest renters that explains the new law and how tenants can
assert their rights to remain in their homes after bank repossession. The fact sheet is available at the Tenants
Together website (www.tenantstogether.org). Renters with questions are encouraged to call
the organization’s tenant foreclosure hotline (415-495-8012). Tenants who need legal representation should
contact Greater Bakersfield Legal Assistance (661-325-5943).
“It’s vital that tenants in Ridgecrest learn about
and assert their rights under this law. Banks, and the realtors and lawyers
they hire, must respect tenant rights under this law,” said Bob Nostrand a Ridgecrest
tenant who fought for the law’s passage.
Tenants Together estimates that hundreds of tenants
who would have faced eviction without this law will now be able to stay in their
homes. With a flood of upcoming
foreclosures, more and more tenants will find themselves protected by this law.
The law, passed on August 19, lists the reasons for
which tenants can be evicted, such as nonpayment of rent. Foreclosure is not listed as a just cause for
eviction. Therefore, tenants in
bank-owned properties may continue to rent their homes until they are resold. In Ridgecrest, a city with a less than 1% vacancy
rate where displaced tenants have essentially nowhere to move to, this will
bring real relief, stability and peace of mind, to many residents in the community.
Ridgecrest joins other cities including Richmond (Contra
Costa County) and Maywood (Los Angeles County) that have recently passed “Just
Cause” eviction ordinances. A total of
sixteen cities now have such laws in California.
Though the impact of the foreclosure crisis on
tenants has long been overlooked, the news media and local governments are
beginning to notice that it’s not just homeowners who are suffering. In March, Tenants Together issue a report
titled Hidden Impact: California Renters
in the Foreclosure Crisis, which conservatively estimated that at least one
third of all residential units in foreclosure in California are rentals.
In May, Tenants Together, which runs a statewide
hotline to assist tenants in foreclosure situations, received numerous calls
from tenants in Ridgecrest’s La Mirage housing complex who were facing evictions
due to foreclosures through no fault of their own. It soon became clear that Ridgecrest renters
were victims of a statewide mortgage fraud scam involving convicted felon James
McConville and his real estate investment company, Diamond House
Development. Most of the 300 units at La Mirage, almost all
of which were renter occupied, were at risk of going into foreclosure.
With numerous renters facing possible eviction at
the hands of foreclosing banks, it was clear that the City needed to take
action to address the crisis.
“Other California cities should take note: this is
a cost-free way for local governments to protect tenants and the entire
community from irresponsible and harmful conduct by banks.” said Tenants
Together Executive Director Dean Preston.