McLeod Law Offices

FOR IMMEDIATE RELEASE

BOSTON – December 9, 2008 – As part of the Patrick-Murray Administration’s ongoing response to the foreclosure crisis, the Executive Office of Housing and Economic Development and the Office of Consumer Affairs and Business Regulation, with support from Massachusetts Housing Partnership, released a brochure outlining the rights and responsibilities of tenants living in foreclosed buildings. The guide empowers renters with information to ensure that they understand the foreclosure process and are not unfairly evicted after the building they live in is foreclosed upon.

Like homeowners, renters throughout the state and the nation are being affected by the foreclosure crisis in real and dramatic ways. Although there are no exact figures, statistics compiled by the Division of Banks show that approximately 30% of the 7,653 Massachusetts foreclosure sales in 2007 involved multi-family properties.

“Renters need to know their rights,” said Daniel C. Crane, Undersecretary of Consumer Affairs and Business Regulation. “Tenants shouldn’t be pressured to pack their bags because their apartment is in a building that is foreclosed on. This new resource provides information that will help families and individuals affected by foreclosure through no fault of their own.”

Many lenders or servicers try to evict all tenants from a property immediately after a foreclosure, even if the tenants have paid their rent on time and have not violated any terms of their tenancy. If tenants refuse to leave, they may be offered a small amount of money, commonly known as “cash for keys.” Tenants agree to these pay-outs under the assumption that they have no other option.

To prevent renters from being unfairly displaced and coerced into leaving their homes, Governor Patrick signed into law last November a measure ensuring that a tenancy will not be terminated by a foreclosure sale.

According to state law, a tenant is entitled to at least 30 days written notice if the owner wants them to vacate the property. A tenant is then entitled to a court hearing if they wish to remain in their home after receiving the proper 30 days written notice. A judge will determine how much time the tenant will be allocated to vacate the apartment. Without court approval, owners do not have the right to evict their tenants. If a tenant receives state or federal rental subsidies, the terms of their rental agreement will not be affected by a foreclosure sale and the tenant should contact the agency that provided the subsidy to understand their specific rights with the subsidy.

New owners are also legally responsible for posting their contact information on the property and for properly maintaining the building. Tenants are encouraged to contact the building owner in writing if they encounter maintenance issues, and to contact their city or town’s housing inspector if they believe their building to be in disrepair.

Tenants with questions or concerns should contact one of the legal resources listed in the brochure or the state’s Consumer Hotline at (617)-973-8787 or (888)-283-3757. The brochure, which is available in several languages, can be found online at mass.gov/foreclosure. It is also being distributed statewide to housing agencies and foreclosure prevention organizations.