Tenants in Foreclosure Intervention Project | Banks Avoid Foreclosure Laws, Uproot Renters

How Big Banks Displace Families Who Rent

In a report (PDF) issued last week by the Lawyers’ Committee for Better Housing, there were 17,467 rental units in 5,904 foreclosed properties in Chicago — which amounts to tens of thousands of Chicagoans who were left homeless in 2010. The banks involved in the majority of the foreclosure filings are Bank of America, Wells Fargo, Chase, Deutsche Bank, US Bank, and CitiMortgage.

Progress Illinois spoke to Diane Limas of the Albany Park Neighborhood Council (APNC) to understand the issue. She said when the owners or landlords of apartment buildings — particularly affordable housing units often occupied by families — file for foreclosure, tenants are left in a bind. Banks attempt to evict the tenants as soon as possible, but the buildings then remain vacant for a long period until a new buyer completes a purchase — if there even is a new buyer. Meanwhile, children are pulled out of school, oftentimes at a random point of the academic year, and families are left fragmented in space and time.

Typically, the renters only find out when the processing bank issues a notice on their door telling them to vacate by a certain date, often seven or 14 days. “The tenant goes into panic. The big banks are praying the tenants don’t know their rights,” Limas said. Legally, the bank must honor the remainder of their lease or housing contract, and if there isn’t a written agreement, the bank must provide at least 90 days to move. Since most tenants aren’t aware of this, sometimes banks will also proactively offer a financial incentive to get them out. For example, the bank might offer a $200 “bonus” if the tenant signs an agreement stating that they will move out in a week, Limas explained.

Full report below…




Tenants in Foreclosure Intervention Project

Protecting Tenants at Foreclosure Act of 2009

Leave a Reply