Renters feel the sting of foreclosure
It used to be a largely unmeasured problem. But now we have some hard statistics on how often local renters are finding themselves caught up in foreclosure because their landlords fell behind.
It happens a lot.
Of the approximately 5,000 Baltimore properties starting the foreclosure process in the 12 months ending June 30, nearly 40 percent -- 1,900 -- were occupied by renters. That's according to the Baltimore Homeownership Preservation Coalition.
And the state Department of Housing and Community Development, which started a hot line in May for renters in this situation (877-775-0357), has been averaging almost 600 calls a month for help.
I have a story today on the subject, or more specifically about the seven-month-old Maryland law requiring lenders notify renters as they seek to foreclose, and the equally young federal law giving renters time post-foreclosure before lenders can order them out. (Attorneys working with tenants say that lenders, or their contractors, are frequently neglecting to mention this.)
The question I know some of you have is how often renters are innocent victims, and how often they contributed to the landlord's default by not paying. The state has interesting statistics on that topic:
Nine out of every 10 tenants who called the state hot line said they were current on their rent. Most said they had never been late.
Granted, some might just be saying that, but Baltimore Neighborhoods Inc.'s tenant-landlord hot line is hearing the same thing. Renters call in angry that their landlords were apparently not putting the rent money toward the mortgage.
"They want to sue for their rent money back," said Stephanie D. Cornish, program manager for the tenant-landlord counseling department.
That's not an option, she says. "You can't control what the person does with your money. ... There isn't any contractual agreement between you and the landlord that they're going to pay their mortgage."
On the other hand, you can sue for your security deposit back if it is not forthcoming. Though whether you'll be able to collect is another matter.
Public Justice Center's brochures on renters' rights
A Wonk post from last year in which an attorney offers suggestions to renters trying to avoid ending up in a foreclosure situation