Renters Rocked by Foreclosure Evictions

Tuesday, September 2, 2008
Brett Wilkinson
Visalia Times Delta

Amber Allison always was careful to pay the rent on her southeast Visalia house promptly.

But in July, she and her family, including her mother and two daughters, were given their eviction notice. They were to be out by Sept. 1.

Their offense?

Allison's landlord had fallen a half-year behind on his mortgage payments. In May, the bank foreclosed and the house went up for auction, forcing the family out of the home they had lived in and grown to love over the past two years.

"I did everything I was supposed to do," Allison said Thursday morning while lugging full boxes from the house in the 3900 block of East Cambridge Avenue. "But now I'm getting kicked out of my place because of what my landlord didn't do."

As she spoke, her mother and a friend packed up food from the pantry and took down drapes. Two movers carted furniture to a large van parked curbside.

The Allisons are among dozens of Visalia tenants forced out of their homes and apartments in recent months by a rush of foreclosures on rental properties, rental-management company representatives said this week.

"It's the tip of the iceberg as far as I'm concerned," said Don Hutton, owner of Visalia-based Mill Creek Management.

Nine of the properties his company manages - six homes and three triplexes - have been foreclosed upon in the last four months because their owners defaulted on mortgages.

"It's quite sad," said Shelly Neal, bookkeeper for Mid-Cal Management in Visalia, which this month has seen three of its units go into foreclosure for the same reason.

Cruel surprise

Unseen victims of the credit crisis, renters, especially those who deal directly with landlords, say they often are the last to know their housing is in foreclosure and will be sold out from beneath them.

Letters from a Texas-based foreclosure company - sometimes four a day, addressed to her landlord but sent to her address - made Allison suspicious.

So did advice from a Tulare real estate agent who tried to help her buy the home in March but warned her that the landlord might be defaulting on the mortgage.

But Allison knew nothing for sure until early May, when she looked in the newspaper and saw a foreclosure notice on her house.

"I was shocked," she said.

Soon after, she learned that despite his numerous reassurances, her landlord had been pocketing her $1,700 monthly rent and not paying a cent on the mortgage.

Allison said she was crushed even more when repeated attempts to buy the house after foreclosure failed.

"We wanted to stay here forever," she said Thursday, packing up for a move to another rental house across town.

Less risk for some tenants

Renters who go through management companies might be better off.

Rental managers said their access to tax or mortgage documents can tip them off to a default situation early. Landlords also may be more forthright when dealing with professionals rather than tenants, they said.

In the event of a foreclosure, representatives said, several companies fully refund the security deposit. For its displaced tenants, Mid-Cal Management takes the extra step of refunding the last month's rent and helping tenants find a new place.

"We try not to put anyone in a panic," said Neal, Mid-Cal's bookkeeper.

Investigating foreclosures, renters' rights

Rental and housing officials suggest several ways renters can investigate whether their dwelling is at risk of foreclosure, and protect their rights when it is. Among them:\

  • If you rent through a management company, ask them to inquire with the landlord about whether mortgage payments are being made.
  • Use private and public Internet databases to turn up any default or foreclosure notices. You'll need the owner's name and the address.

    Private services include realquest.com and preforeclosure.com; the Tulare County's Recorder's database is http://riims web.co.tulare.ca.us/riims web/Asp/ORInquiry.asp.

  • Watch the newspaper. Foreclosure-sale notices are published in the Classified section of the Times-DA new state law, however, gives renters 60 days after a foreclosure sale to move out.
  •  

During
that time, tenants are not required to pay rent and landlords have no
right to ask for it, said Suzanne Swenk, a supervising attorney with
the Visalia-based Central California Legal Services, which advises
low-income tenants in rental disputes.

Tenants still are
obligated to pay rent in the immediate period before a foreclosure
notice or sale, Swenk said, but many do not.

"What's the landlord going to do about it?" she said.

 

 

 

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