You might think renters don't have to worry about losing their homes to the bank. But many have been turned out onto the street--although they were current on their rent--because the landlord wasn't current with his mortgage payments. The National Low Income Housing Coalition estimates that 40 percent of the households that lose their homes to foreclosure are renters evicted after the bank takes the home from their landlord.
Renters now have more protection against losing their homes under the new foreclosure prevention bill President Obama signed into law yesterday.
Starting immediately, the law requires that tenants who pay their rent on time can remain in their home until the end of their lease, unless the bank sells the property to someone who intends to make it his own residence. Even without a lease, renters must be allowed to stay in their home for 90 days after the foreclosure. The provision is scheduled to expire at the end of 2012.Jurisdictions that already have more stringent renter-protection laws in place won't see the rules loosened by the new federal law. The District, for example, already protects renters from being evicted during the term of their lease unless they fail to pay rent or provide another just cause for eviction. The National Law Center on Homelessness and Poverty has a state-by-state description of eviction and foreclosure laws on its Web site.