Tenants Together, California’s statewide organization for renters’ rights, published a report in March on the issues facing California renters in the foreclosure crisis. Using statewide data, the study conservatively estimates that one-third of residential units in foreclosure in California are rentals. As in other states, these renters who did nothing to contribute to the crisis are facing eviction, loss of security deposits, and utility shut-offs when their building owners are faced with foreclosure.
In order to obtain aggregate California foreclosure data, the study uses data from Foreclosure Radar, a foreclosure data service that compiles county parcel tax records. This study looks at the number of units in foreclosure in California, in contrast to previous reports that focused on the number of properties in foreclosure. The unit data reveal that more than 225,000 renters were affected by foreclosure in 2008.
In addition, the study randomly selected 100 callers to Tenants Together Tenant Foreclosure Hotline who were renters in single-unit properties that were not owner-occupied. The callers’ addresses were checked against county-based data for the individual properties. This random selection found that a majority of the callers’ renter-occupied homes were listed incorrectly as “owner-occupied.” These inaccurate owner occupancy listings suggest that data based on county records dramatically undercounts the number of foreclosed homes that house renters. Using this information, the study concludes that there are likely a much higher percentage of renter-occupied households in foreclosure than the data initially indicated.
The study concludes that renters deserve greater protections in foreclosure proceedings. Necessary protections include:
- stronger eviction protections for renters who hold up their rental agreements;
- stronger habitability protections to compel banks to maintain habitable conditions for existing tenants;
- stronger security deposit laws to force the return of deposits for renters that do vacate premises; and
- stronger notification requirements so renters are notified earlier regarding default.
Currently in California, renters are not notified of an impending foreclosure until the Notice of Trustee Sale, which is served 20 days before the foreclosure sale. Renters are often forced to vacate their homes with little to no notice and without their security deposit to help with moving expenses. These factors contribute to increased homelessness among renters.
The report, Hidden Impact: California Renters in the Foreclosure Crisis can be found here: http://www.tenantstogether.org/downloads/ForeclosureReport.pdf