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Unpublished Paper
Renters Evicted En Masse: Collateral Damage Arising From the Subprime Foreclosure Crisis
ExpressO (2010)
  • Creola Johnson

ABSTRACT: America is experiencing its worst foreclosure crisis in history, and tenants are the silent victims of this crisis. In this Article, Professor Johnson describes the consequences of thousands of tenants of being evicted from residential properties obtained by lenders in foreclosure proceedings against the owners-landlords. The individual consequences include tenants’ renting substandard alternative housing, experiencing disruptions in family life, and even becoming homeless. Societal consequences include the costs imposed upon communities to provide social services to the evicted tenants and their families and the burden on cities in dealing with homes left vacant due to the lenders' inability to sell them and failure to properly maintain them. Professor Johnson’s analyzes the effectiveness of existing and pending ordinances and statutes designed to afford protection to tenants who are not in default under their leases. She proposes amendments to the Protecting Tenants at Foreclosure Act to inform tenants of their rights and to incentivize lenders to act rationally to maximize their economic self-interest and not rely on an outdated policy of automatically evicting tenants. Specifically, She proposes that lenders and their agents be required give tenants standardized form notices at least two points in time to make clear to tenants who continue to pay rent that they have (1) the right to stay in the foreclosed property for 90 days, (2) the right to have continued utility and maintenance services during that period, and (3) the right to be free from pressure leave to leave early. Lenders can shorten that period by giving tenants reasonable monetary offers to compensate them for vacating the premises early so that they can find suitable affordable housing. However, the lenders must maintain the vacant properties to prevent them from becoming public nuisances and burdens on local municipalities.

  • foreclosure crisis,
  • subprime mortgages,
  • tenants' rights,
  • Protecting Tenants at Foreclosure Act,
  • New Jersey Foreclosure Fairness Act,
  • anti-eviction statutes,
  • consumer protection
Publication Date
February 26, 2010
Citation Information
Creola Johnson. "Renters Evicted En Masse: Collateral Damage Arising From the Subprime Foreclosure Crisis" ExpressO (2010)
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