PJC In The News

MD Daily Record: Of Service: It's a new era for tenants facing eviction

Special to The Daily Record

August 24, 2009

Here’s a dirty little secret of the foreclosure crisis: Nationally, about 40 percent of folks losing housing are tenants evicted because their rental property was foreclosed. (The number is around 25 percent in Baltimore.)
Not because they didn’t pay their rent. Or the TV was too loud. Or the dog was barking.
Luckily, that disturbing aspect of the plunge into an economic morass may soon be behind us.
First, some background.
“Under previous law, foreclosure extinguished the underlying lease and even good tenants who were current on their rent were evicted,” explained John Nethercut, executive director of the Public Justice Center in Baltimore. “Usually banks ended up owning the house. And they wanted to sell it.”
But recently, important changes in tenants’ rights have surfaced, both in Maryland and nationally. And a coalition of housing activists and legal service programs is taking shape in Baltimore to make sure the new laws get the recognition they need to be effective.
“There are new times ahead, fraught with questions,” Nethercut said.
The groups joined forces after housing and tenant advocates noticed more calls coming from tenants facing eviction.
“We started meeting together, sort of a coalition of coalitions — Legal Aid, the PJC, the Homeless Persons Representation Project, the University of Baltimore legal clinic, and the Baltimore Homeownership Preservation Coalition,” Nethercut said. “We put together a program to gather information about the people affected, to start writing a tenant education brochure to give advice and referral, and to begin policy advocacy.”
The PJC led the advocacy role in Annapolis, successfully supporting legislation in the General Assembly that’s now law.
“Now tenants get notice when their landlord is in foreclosure,” Nethercut said. “In the past, they wouldn’t know. Everyone agreed it’s only fair to tell tenants what’s going on. Banks and the foreclosure purchasers are now required to send notice to the ‘occupants’ to tell them a foreclosure is in process.”
The new Maryland law providing notice was an improvement, according to Nethercut: “But the PJC and its allies also supported another bill that would have gone further and provided new rights to tenants. But that bill died in committee.”
Enter the feds.
“With the new administration in Washington, for the first time in decades we are seeing tenant protections coming from the federal government,” said Nethercut. “One stimulus bill President Obama signed included the Protecting Tenants at Foreclosure Act.
“Now, even after the house is sold at a foreclosure sale, a ‘bona fide’ tenant’s lease continues until the end of the lease,” he continued. “The new owner can terminate a tenancy with a 90-day notice if it is a month-to-month tenancy or if they sell to someone who wants to have the house as their personal residence. But every tenant will get at least 90 days.”
The bottom line: When the property owners falls into foreclosure, tenants can remain as tenants.
“This is, for tenants’ advocates, an exciting time,” Nethercut said. “There are now substantive rights under federal law and notification requirements under state law. It’s all new to the courts, sheriffs, banks, and tenants. We’re excited to begin implementing these new laws, and expect it will be sorted out over the next year.”
To move things along, the PJC recently applied for federal stimulus funding to ramp up a project to help tenants in foreclosure. 
“We’re hoping to hire an attorney to focus on this area,” Nethercut said. “Now, everyone’s doing what we can with existing resources. The major activity is to get the word out and coordinating the various players, such as service providers, foreclosure attorneys, and courts. They all must be brought to the same page.”
Sally Scott, co-chair of the Baltimore Homeownership Preservation Coalition, has been working on the issue for the past year with Nethercut and other tenants’ rights experts.
“We’ve been working on materials for groups who get calls for help and that could also be distributed directly to renters that explain options when they’re in this situation,” Scott said. “They need to know they’ve got the right to stay in the home. Folks are spread out, so we would like to combine flyers with media outreach.
“We want to do for renters what we’ve done for homeowners,” Scott continued. “The feds have created significant breathing room for renters, but they need to know about it. All these great laws can be on the books, but it doesn’t help if folks don’t know about them.”
Kathleen Skullney of Legal Aid’s Foreclosure Legal Assistance Project pointed out that it wasn’t just the state and federal governments that reacted quickly to the problems faced by tenants facing eviction because of foreclosure.
“[The Maryland Judiciary’s] Rules Committee was astute enough to include the newest changes in the court rules that became effective in June,” Skullney said. “Combined with the expanded foreclosure process, tenants have finally gained the legal stature they should have — parties with interest with access to the foreclosure process and as parties in their own right in district court with significant statutory and procedural rights.”
There’s one more hurdle, she added.
“The only serious problem that remains is to make sure that all the courts are onboard with these changes as quickly as possible,” Skullney said. 
Read the original article at The Daily Record: Of Service: It's a new era for tenants facing eviction

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