Now Even Renters Are Losing Their Homes Over Mortgage Foreclosures
By Susie Madrak Monday Nov 23, 2009 3:00pmThis is really sad. This is going to hit even harder in big cities, where so many of the poor live in multi-unit buildings:
NEW YORK -- A new wave of foreclosures stands to hurt people who may have never taken out a mortgage: renters. In cities such as New York, Chicago and Los Angeles, where many investors are carrying upside-down mortgages on large rental buildings, some tenants are watching their homes fall apart along with the financing.
Janeia Sandiford, a 24-year-old GED student in New York, has two young children and a deteriorating apartment. When a leak over Sandiford's bathroom and kitchen caused the ceiling to flake off and then cave in, nobody came to fix it for a year, she said. She lacked heat most of last winter, and she has duct-taped her loose-fitting windows in place to cut down on drafts.
"I'm really worried about the kids," she said.
The real estate investment company Ocelot Capital Group bought the building where Sandiford lives and about two dozen others in the Bronx in 2006 and 2007. As the new owners struggled to keep up with payments, 10 of the buildings appeared on the city's list of most dilapidated rental properties in 2007 and 2008. Last winter, as Ocelot defaulted on its loans amid the deepening financial crisis, the buildings plummeted further into decline. Together, they racked up thousands of Code C violations --the most serious kind -- from housing inspectors.
Fannie Mae, which had bought much of the debt from the original lender, entered foreclosure proceedings for Sandiford's building early this spring. A state court appointed receivers.
In the meantime, the building on Manida Street has been beset by problems, according to tenants and their advocates, whose accounts were confirmed by the crumbling walls and damaged plumbing apparent on a tour of the property and its neighbor, also owned by Ocelot. Vandals stole the lock on the front door, giving squatters access to vacant apartments to sell drugs. Plumbing in the building was disrupted after the squatters broke through the walls and stole pipes to sell as scrap metal.
Similar conditions could crop up across the country this winter as foreclosures climb for large rental-unit buildings. In the first three quarters of 2009, 475 foreclosure proceedings were begun against multifamily rental or cooperative homes in the District, according to NeighborhoodInfo DC, a partnership between the Urban Institute and the D.C. Local Initiatives Support Corp. That figure already eclipses the 458 foreclosures for all of 2008.
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Slumlords are the most obvious owners to be over leveraged and uncaring.
When the economy is bad the ripples roll out and over the poor. This will continue even after the economy recovers.
Jobs are a lagging indicator while poverty is a constant.
This has been happening for a few years now:
http://www.ireport.com/docs/DOC-109030
a class action suit is in order or if an attorney would step forward to bring some charges against these slumlords and the lenders.
Stick another finger in the Bankers Association's eye!
and stick another finger in the eyes of those CEOs who are whining and complaining that making several million dollars a year just isn't enough for them...
CNN? No, that ain't it. NBC? No, guess again. CBS? No. ABC? Uh, no. FOX? Uh-uh. Al Jazeera? Yep.
Another symptom of the New World Order I keep hearing so much about?
For effing up the country, as in FUBAR'd
really hates working people i'd say...
Goldman Sachs, or a healthcare insurance co, or Raytheon, or General Electric, or Baxter pharmaceutical, or Halliburton, or a lobbying firm...
don't work.
...although capitalists do have "income"
"Income" is when you can sit back...
(because the money just) "comes in"!
"Income" ...whats in a word?
Gee. Good thing Obama is working so rapidly to get the banks fixed.
Excuse me... what's that..? "A year later and not a single piece of corrective legislation is even in the pipeline," you say?
Perhaps I'm being thick here, but what does the value of the building matter?
They knew the mortgage payment amount when they set the rental cost per unit. Those costs have not changed with the plummeting property value. Maintenance costs and other expenses should have been figured in as well.
Whatever the reason that they're not making their mortgage wouldn't seem to me to be the housing market. In fact, the position may have improved because lower property values might have reduced their property taxes. It's not likely, but it's possible.
edit - or was this a result of a ballooning mortgage that they planned to refinance...?
i still don't get how the family was seemingly evicted without warning considering that there are supposedly strong rules in place for the renters of los angeles.
so long as Goldman Sachs can give out 16.7 billion in bonuses, I guess that makes everything OK.
My partner and I have been renting a house in northern NV for the last couple years, and got the official "You are in danger of being foreclosed upon" notice in early October - the day after making a rent payment.
So we stopped payment on the rent check, informed the management company via certified mail that we wouldn't be paying rent until the matter of foreclosure was settled and that they were welcome to contact us about arranging payment should the situation change - and haven't heard a single word from them since.
Fortunately, renters have a few things going for them. First, renters can't be evicted from a foreclosed home without three months of post-foreclosure time during which the new lease holder may charge rent. I'm not sure how that is supposed to work, exactly, but I suspect the rent can't legally be any more than you paid prior to the foreclosure. That gave us five months, minimum, before we needed to move - with the exception that you can be asked to move out if the home sells to someone who intends to live in it as a primary residence. And in those cases, they're likely to want to be on good terms with you so you don't trash the place.
There is a silver lining, however. The money we haven't paid in the last two months for rent was able to be repurposed as the money we can use to look at buying a new house. It's a buyers market, and last week a bank accepted our offer on a USDA guaranteed loan for a nice house outside town. It's looking like we'll be able to get a comparable place to this rental for $200 less than we pay currently in rent, and the $8000 tax refund next year for new homebuyers will wipe out the credit cards with a $250/month minimum payment.
Perhaps the interviewer wasn't American, but wouldn't you think these particular renters, as someone who has been in the country for at least 20 years ('haven't missed a rent payment in 20 yrs.') would speak SOME english?
yes, you can go 20 years and not have to learn english, or even just speak a bare minimum
chinatown is chinatown, english and mandarin signs and languages
thaitown is thaitown, english and thai signs and languages
koreatown is koreatown, english and korean
monterey park is one big "little asia" and the signs are mixed with korean, chinese, and thai
there are parts of los angeles that just have spanish billboards and storefronts
all of these places are self-sufficient communities for their immigrant base, so some first gen's learn english and others do not, but the kids will grow up learning english through the schools.
and, just to note about the news service, al jazaerra went on a hiring campaign to have multilingual reporters for their american offices. given what los angeles is, it doesn't surprise me.
America -- the greatest country on earth. Home to bankruptcies due to healthcare expenses, home forclosures and credit card debt. We're doomed.
I've become alarmed recently at the number of vacant apartments in my building here in Queens, New York. Because of Rent Stabilization, most of the rents are relatively reasonable, yet so many people are losing their jobs or underemployed to such an extent, they can no longer afford even these apartments.
It's unlike anything I've seen in this area, where I've lived for 20 years, and decidedly worse than even a few months ago. The economy is not recovering, the economy cannot recover, because Wall Street is busy choking the life out of Main Street.
in la county, evictions for renters arent that ez, even if the property is foreclosed upon
except i have lost a couple of neighbors lately, their stuff being disposed of in the dumpster.
we are supposed to get a 30day notice in most cases, but not all; and i thought mayor villaraigosa had recently enacted some sort of protection for renters against landlord foreclosures. all in all, that guy was definitely given the big boot and nights are pretty chilly in los angeles, and the rainy season is approaching.
REAL Christian Americans please stand up to this travesty?
The American dream is now an American nightmare.
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