Families renting in apartments and houses in inner cities have become the latest victims of the housing market crisis as more and more properties have been added on foreclosure listings.
Major cities in the United States are experiencing a rapid spread of abandon and vacant homes as foreclosure listings continue to surge in terms of numbers.
And foreclosure has claimed its latest victims: tenants who pay their monthly rents on time and have violated no rules. As more and more landlords in inner cities default on their loans, hundreds of tenants are forced to leave their rented apartments and houses.
And the bad news is, most of these renters were not informed that the apartments and houses where they live are included in foreclosure listings.
Some landlords do not have the consideration to inform their tenants that they are facing eviction because their properties are among those included in foreclosure listings. Before they know what has hit them, tenants are forced out into the street, scrambling to find an affordable place to live.
The widespread problem has influenced the Los Angeles City Council in California to stop evictions and to purchase abandon and vacant buildings on foreclosure listings to convert them into affordable apartments.
Other cities in the country have find ways to address the effects of foreclosures on renters. Cook County Sheriff Thomas J. Dart in Illinois has required banks to provide renters a four-month eviction notice. Foreclosure evictions in the city of Chicago have increased three times since 2007, with 4,500 cases in 2008.
Meanwhile, in Boston, Massachusetts, postcards were sent to renters informing them of their tenants’ rights. The city also mandated property owners to place a sign on their rental apartments or homes with the name of the landlord and contact information. Additionally, Boston is considering purchasing buildings on foreclosure listings.
Evictions are expected to increase as the steady rise of default rate on rental homes and apartment buildings continues. According to Federal National Mortgage Association, delinquency rate for its owned or backed loans was .30 percent for the last quarter of 2008, a quadruple increase from 2007.
According to Dustin Hobbs of the California Mortgage Bankers Association, majority of evictions were initiated by banks that do not want to act as landlords after they have taken over foreclosed properties. Aside from that, banks do not want to hire property managers to look after foreclosed properties, said Hobbs.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.
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