Thanksgiving Eviction: No Thanks

Wednesday, November 21, 2012
Tenants Together

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On paper, Fannie Mae has rental policies that are far superior to other financial institutions.  Rather than evict all tenants after foreclosure, Fannie Mae’s policies require the mortgage giants to offer tenants a one-year lease option.  Tenants Together, California’s statewide organization for renters’ rights, has criticized and praised Fannie Mae in the past, as compliance with the policy has ebbed and flowed.
“We’re seeing disgraceful conduct by Fannie Mae right now,” commented Tenants Together Legal Director, Leah Simon-Weisberg.  “Whatever good they may have done in the past by adopting more tenant-friendly policies, they are rapidly undoing with their current evict-first practices.”

Simon-Weisberg pointed to a case in Merced, California as a blatant example.  Michael and Michelle Byus have lived in Merced all of their lives.  They have been paying rent for their home for more than two and a half years.  In direct violation of Fannie Mae’s policy and Merced’s then existing anti-eviction law, the tenants were told by a Fannie Mae real estate agent in April 2012 that they could not be provided a year lease and would have to move.  The family inquired to whom they should pay rent and were told by the real estate agent that Fannie Mae was not going to accept rent.  After the family did not accept a move out offer of 30 days, they heard nothing else from Fannie Mae until they requested repairs.  Then in June, when the tenants called regarding repairs, they were told that they would have to move.  More than a month later, the family was served a 60-day notice in violation of federal law and Fannie Mae’s policy.  Fannie Mae's National REO Rental Policy is supposed to allow tenants living in its foreclosed properties the option of signing a new one year lease if they wish to stay in the home.  Nonetheless, Fannie Mae proceeded with an eviction lawsuit (unlawful detainer) and has refused to stop eviction proceedings despite the repeated requests of the tenants.

According to Michelle Byus, “All we want to do is stay in our home and pay rent.  Apparently, Fannie Mae would rather keep this home vacant.  I can’t understand why they are evicting us.  It’s really taking its toll.”

Michelle’s case is unfortunately common.  In the last month, Tenants Together has received a rising number of calls from communities such as Merced, which are hard hit by foreclosure, complaining of Fannie Mae agents misrepresenting Fannie Mae policy. 

Tenants Together is uniquely positioned to track trends among post-foreclosure landlords.  The organization operates a hotline for tenants in foreclosure situations. In recent months, the organization has seen a sharp rise in complaints from tenants living in properties acquired by Fannie Mae at foreclosure. Fannie Mae is increasingly moving forward with blatantly illegal evictions, violating federal, state and local law, violating Fannie Mae policy, and further tarnishing Fannie Mae’s reputation.

On the eve of Thanksgiving, tenant advocates are closely watching Fannie Mae conduct in Merced.  According to Tenants Together Legal Director, Leah Simon-Weisberg, “Fannie Mae has the opportunity to do the right thing in Merced and give relief to the Byus family for Thanksgiving.  Fannie Mae should immediately set aside their eviction case, offer the Byus family a lease, and begin a review of Fannie Mae’s compliance with its own policies.”

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