What is this blog for?
This blog is for California tenants whose landlords have allowed their rental property (your home) to go into foreclosure. Here you'll find most of the information you need to cope. It won't save your home; foreclosure law is of, by, and for the owning class. It won't make you less angry; you should be angry. What it will do is explain the foreclosure process in California, so that you'll know what options you have and, most important, how much time you have to relocate. Please read the entire blog as, while I try to present everything in a logical sequence, information may sometimes not be where you think it should be.
You'll find various miscellaneous entries at the end when I've been good and re-dated the blog entries, so that the information stays both current and coherent.
What about the rest of us?
If you don't live in California, much of the information here won't help you. Foreclosure laws and procedures vary by state, and I'm not competent to give you much help in dealing with your landlord or your landlord's lender. Having said that, the Protecting Tenants At Foreclosure Act applies to all tenants in foreclosed properties in the United States. I will discuss this legislation in its own section, so that you can find it easily. In addition you should probably read the section on "cash for keys" and the section on protecting yourself from bad landlord and lender behavior, as egregious conduct seems to have spread across the country faster than H1N1 did.
So who the hell are you?
I am a long-ago tenant activist, and I wrote the first edition of this blog in 2007, when foreclosure was still relatively uncommon. Mercifully, foreclosure procedure in California is relatively straightforward, so putting this information together wasn't terribly complicated. I'm not a lawyer, so I can't give you legal advice or represent you, and I will sometimes tell you that you need a lawyer immediately. But for most tenants in California communities without rent control or "just cause" eviction, a lawyer will not be able to do any more for you than you can do for yourself. If you do live in a community with rent control or "just cause" eviction, please read my entry on rent control carefully. Foreclosing lenders have been very badly behaved in evicting tenants protected by rent control and "just cause" eviction, so you will need to take action to protect your rights.
So what's changed since you first wrote the blog?
Remarkably little. I wish I could report that lenders and their servicers had seen the light and allowed tenants to stay in foreclosed properties to keep them occupied until they were sold, but that isn't true. I wish I could report that lenders and their servicers always gave tenants the required legal notice, but that would--unfortunately--be a lie. I wish I could report that lenders and their servicers always required that the realtors working for them treated tenants in foreclosed properties with respect and courtesy. But that wouldn't be true either, and tenants who are Latino or African American often receive special discourtesies. Sort of like shopping at Nordstrom's. They're just as ill-behaved as they were in 2007. In fact, some have used the experience of the crisis to refine their nasty tactics.
The only good things are that Tenants Together has a hotline for California tenants in foreclosed properties, and local tenants' groups are working to protect tenants in their communities. This is particularly important in communities with rent control and/or just cause eviction, as tenants in those communities have rights the State Legislature has not seen fit to grant the rest of us. In addition, TT publishes regular reports of the plight of tenants in foreclosed properties.
The Tenants Together Hotline, in particular, can help with more difficult problems like utility shut-offs, badly-behaved lenders, and the like. In addition, you'll realize that you aren't alone, as nearly a million tenants in California have had to deal with their landlords' foreclosures.
So what are the three most important things the State Legislature could do for tenants in foreclosed properties?
Yes, only three. Otherwise we'll be reading far into the night.
First, all county recorders/assessors should be required to send a copy of any Notice of Default to the occupants of any property on which a Notice of Default has been filed. This gives tenants an early warning of a problem and enables tenants to plan their lives, rather than being at the mercy of the charming fellows we have deciding policy at Wells Fargo and Deutsche Bank. Presently only San Francisco and Fresno send warning of the Notice of Default to all properties in those counties.
Second, the State Legislature could enact statewide just cause protections for foreclosed properties. This would, particularly, protect low-and moderate-income communities, where foreclosures leave large numbers of unoccupied, and deteriorating, properties strewn about the neighborhood. Cities tend to be much more assertive in protecting richer neighborhoods, so the state should take the lead in protecting everyone. Now the State Legislature has extended 90-day protection to most tenants in foreclosed properties in California, but "just cause" eviction would give tenants more protection and limit the "life after people" landscapes in so many low-income and minority neighborhoods.
That's actually three, you know, but we'll give you one more.
Thanks. The State Legislature should pass a law like that in Oregon, enabling tenants in properties where a Notice of Default has been filed to withhold rent to recover their security deposits before the foreclosure sale. That would save tenants from having to sue the bank to recover their money. And...
Stop. That's enough.
Special note: if the lender is trying to sell you the house you rent, read this first.