Renters Can Face Foreclosure Problems Too
November 26, 2007
Some might say that it was only a matter time before renters would find themselves being evicted from apartments and especially homes as the owners of those properties fall into the housing market mess.
When property owners fail to meet their mortgage obligations, it is often the people who are renting that feel some of the harshest pain. Renters who have been paying their rent on time and in full are no better protected than those who are less diligent.
Now, some protection seems to be on its way. The House recently passed a mortgage act that includes renter protection. The new act would require property owners to give tenants a 90-day warning that the property is about to be foreclosed. Renters would also be granted a fair amount of time to vacate once the property was foreclosed.
To date, there are no precise figures relating to renter-foreclosure evictions but according to a 2007 Mortgage Bankers Association survey, one in eight foreclosures involved properties that were not owner occupied, The New York Times reports.
Renters may not even know their homes are about to be foreclosed which can lead to a host of financial problems including finding the cash for new deposits, moving expenses, and new utility hook up deposits.
Nevada, Arizona, and Florida are the top three states in which renters are finding their homes being foreclosed. In Nevada, for example, the foreclosure rate hit for rented property hit a whooping 28 percent.
It has been estimated that more than one million properties are expected to enter foreclosure this year