As many homeowners struggle with mortgage and loan payments, a recently enacted Illinois law seeks to help a sometimes overlooked party in foreclosure transactions – renters.
Public Act 96-0111, or the Renter’s Bill of Rights, was signed by Gov. Pat Quinn on July 31 and went into effect Oct. 29. Under the law, the new owner of a property in foreclosure must notify residents at least 21 days in advance of the foreclosure’s completion and give renters at least 30 days to move after an eviction hearing. Owners who fail to do so are unable to collect rent or evict tenants due to non-payment.
The passage of this law will provide renters with essential information about who’s actually in charge of rental properties, said Samantha Tuttle, housing staff attorney for the Sargent Shriver National Center on Poverty Law.
“It is a confusing situation for renters to be in when their property is in foreclosure, especially if the original landlord has stepped out of the picture,” she said. “We have heard of stories of old landlords who continue to collect rents. Hopefully this notice will allow tenants to be more informed so they can better protect themselves.”
About 40 percent of families facing foreclosure are renters, according to the National Low Income Coalition. The best thing for renters in a foreclosed building to do is to talk to their lender, said Donna Spicuzza, Evanston’s housing planner.
“Foreclosure is a concern for residents who are going through it and for their neighbors and for neighborhoods to see vacant buildings in the city,” she said. “We don’t want to see this happening.”
Renters at risk of eviction due to foreclosure should get information in writing and be careful about to whom they’re paying their rent, Spicuzza said.
Evanston’s foreclosure rate has increased in recent months. According to a May report by the Woodstock Institute, a Chicago-based policy and advocacy non-profit organization, the owners of 83 properties in Evanston filed for foreclosure from January through March of this year – a 34 percent increase from the same period the previous year. In 2008, 267 properties went through foreclosure in Evanston.
“One of the things we love most about Evanston is the diversity of the people,” said Evanston Mayor Elizabeth Tisdahl. “Many have been threatened by this recession and the high cost of housing and the foreclosure rate. There are a lot of vacant, boarded-up buildings – lots of people have had to leave town.”
In July, the city of Evanston applied for a $40 million neighborhood stabilization grant from the U.S. Department of Housing and Urban Development. The grant would allow Evanston to buy foreclosed and vacant properties, primarily in the fifth and second wards, that can be converted into affordable housing projects, Tisdahl said.
On Saturday, the city will host a “Take Control of Your Mortgage Situation” workshop with the Interfaith Housing Center of the Northern Suburbs at the Fleetwood-Jourdain Community Center, 1655 Foster Street.