Thursday, October 09, 2008

Meanwhile, in the People's Collective of Chicago...

...homeland of Lord Obama, the good Sheriff has told the mean bourgeoisie bankers that he will not be doing foreclosures on rental properties.

Power to the people!


Rick C said...

When I read that the bankers' association accused him of "'vigilantism' at the highest level of an elected official," I kinda lost sympathy for the banks, however.

Laughingdog said...

Not that I'm a big fan of Chicago or anything, but isn't this actually a legitimate role of the executive branch? Determining how to enforce the laws on the books does include not enforcing one because you think it's a bad law.

crankylitprof said...

It must be TEH AWESOME to be able to decide which laws you're going to enforce, and which ones you won't.

He must have been touched by The One to be so discerning.

Roberta X said...

H'mm, Bankers who mangle the language or Sheriffs who mangle the law: which one is liable to do you the most harm?

This pronouncement condones and supports the cancerous growth of the gigantic teeming slum that is the heart and soul of modern Chicago, a blot upon the planet. "City of broad shoulders?" More like City of grifters and bums!

Sevesteen said...

I can't really tell from the story what is really going on--This could easily be a sheriff who is insisting that the foreclosing banks follow the law, and that he won't be doing foreclosures where they have not done their legally-required part.

...or it could be announcing a free pass for landlords in financial trouble to keep collecting rent without paying on their mortgages.

Jason said...

Actually, this sort of thing goes on all the time everywhere. Law Enforcement is usually chartered to "make judgements as to wether something should or should not be enforced." Examples would be wether to write a citation or a warning for a moving violation, or something like a cite and release for minor amounts of certain schedule narcotics. Alternately, an officer can chose to detain individuals for these same crimes.

Some people did get tired of the "flexibility" of allowing law enforcement to make field determination as to what was and wasn't enforced, so you end up with laws that "require" that one party goes to jail under domestic violence laws.

What law enforcement CANNOT do, is make up laws and enforce those fictional laws as if they were real.

perlhaqr said...


Seems fairly reasonable, at first blush. If the banks are required to determine who is actually occupying the building, and not merely who has their name on the note, and they are failing to do so, telling banks "we're not doing your job for you any more" and stopping eviction proceedings broadly provides a strong incentive for the banks to get their act together.

I don't see that tossing tenants who have been paying their rents on time simply because their landlords are in arrears to the bank as being ethically correct. You've got a breach of contract, sure, but not on the part of the tenant.

It would make far more sense for the banks to identify occupied houses they intend to serve eviction notices on, and get a judge to sign off on a lease change that cuts the landlord out of the loop.

Tam said...

But doing that, and quietly, would make no political hay.

Then again, I used to repo cars, so I'm a heartless bitch.

Anonymous said...

Why are the banks taking the easy road on this one? What they will end up with is a property on their books that will become absolutely worthless unless they can get it sold or occupied quickly, property that the bank then has to pay taxes on. At best, it behooves the bank to do their research, find if there are tenants already on the property, and make terms with the tenants that takes the defunct landlord out of the loop and keeps the property occupied and paid for.

It's even worse when the properties in question become vacant after an eviction. There are entire industries of criminals who look for these vacant houses, and go in and tear out anything of value, down to the copper pipes and wiring, leaving the house in an absolutely unsellable condition where the resent owner of the property (the bank) has to spend several thousand dollars in repairs just to get it to a sellable condition. And forget collecting insurance...most insurance companies won't touch vacant properties even with MY 10 foot pole.

This Sheriff is doing the industry a favor and ringing the alarm bell that they aren't doing a very good job. WAKE UP! If there are tenants on the property you are foreclosing on, make terms with the current tenants so you don;t end up with a vacant, nonprofitable property!

Rick C said...

"Then again, I used to repo cars"

Cool. Did you have any friends that used to get sushi and not pay for it?

Mark Alger said...

Dunno about most places, but in Ohio, a landlord can't evict tenants (without lengthy foreplay) so long as their rent is paid, unless the landlord is going to convert the building for his own, personal use.

Which essentially makes The One's assertion an empty gesture. At least, in the Buckeye State. Tentants couldn't be evicted anyway. They just switched landlords.


OldTexan said...

The headline is a bit mis-leading and inflammatory. Like a lot of news stories, when you read the whole thing the sheriff is simply stating that the banks need to do their leg work and determine the status of the dwelling and give proper notice to the occupants before he will execute and eviction.

Without the headline it is just another ho-hum story, with the headline it is one more failure of the current administration to take care of the little people that needs change or some sort of crap.

Anonymous said...

Good for the sheriff. These people are still people, they didnt stiff the bank.

But I dont get it. If these are people paying rent- on time- then why dont the banks work with the renters on BUYING the homes. Now the banks have money coming in, and potentially will give homes to people whp need one.

Banks! Sell to the renter !

Anonymous said...

While it's the "feel-good" solution to just have the banks start charging the tenants directly, everyone is forgetting that this sets the banks up as landlords, with all the requirements, challenges, and problems that come along with it. This would require an expensive new infrastructure that most banks do not have.

If the sheriff is saying he will not execute an eviction order if it is not proper and complete according to the law, I'm with him. If he's saying he will refuse to serve a legal eviction order, which it is his job to do, he should be removed from office and/or charged with contempt.

Anonymous said...

While it is unfortuate for the renters that they have to move, the idea they are being wronged is not correct. They paid a set amount per month, for a place to live. They received the services they paid for. Yes, they do have to find a new place to live, but apart from the hassle they are not having equity ripped away from them.

SB said...

Not entirely true; if they have anything beyond a month-to-month tenancy, then they are being evicted without cause in violation of their lease agreements. Finding a new place to live is a significant expense, especially when it is entirely unplanned.

SpookyX said...

But the lease agreement is between the renter and rentee not the renter and bank. If the renter forfeits the property doesn't that make the lease agreement null and void?

John A said...

The legality of the Sherrif`s move is still being debated, but the preponderance is on his side. Whoever seeks to evict is required to notify the evictee: the banks notified owners, not tenants, and when this became known to them they jsut added the tenant name without notification. That is, on the face of it, illegal.


He said that in a third of the 400 to 500 foreclosure evictions his deputies had been carrying out every month, the residents are not those whose names are on the eviction papers.

Nor, he said, are banks notifying tenants that the homes they're renting are in foreclosure. He added that when banks do learn the correct names of those living on foreclosed-upon property, their names often are simply added to eviction papers.

"They just go out and get an order the next day and throw these people's names on there," Dart said. "Whether they (tenants) have been notified, God only knows."

Brett said...

If the lease predates the mortgage, the lease continues unmodified. If the mortgage predates the lease, the lease is converted to a month to month lease upon foreclosure with the bank as landlord. The bank must provide the required notice for ending a month to month lease (anywhere from 30 days to 180 days depending on the state). If the tenant is still residing in the property, then they are evicted.
More important with the evictions in Chicago, these evictions go on the credit record of the tenant, not the landlord; this generally means the tenant is automatically rejected from renting for most properties.
(Note: rent-controlled and section 8 leases cannot be converted to month to month and must be completed by the bank as signed by the original property owner.)
The original landlord is liable for all costs of moving for the tenant (application fees, apartment search services, and moving services) as well as the difference in cost when the tenant signs a new lease for a comparable property. Believe it or not, nearly all tenants who bring these cases win, and most eventually collect the court award.

Bob F said...

WHo else is going to occupy these rental buildings?

This is what is idiotic about foreclosures, unless you have a new buyer lined up and he is demoing the building what difference does it make if people are allowed to stay.

If the banking association had their way everyone would be out on the street and all the houses would be empty.

P.S. Cops choose not to enforce laws all the time, if they didn't they would barely move 10 feet each day with all the infractions constantly going on in society.

mts said...

On one hand, the banks are stupid for not leaving the property occupied, subject to evacuation 30 DAC upon sale. Get some insurance so no one can sue them for getting hurt on premises, then let it ride.

Heck, money in is money in, and these bankers are throwing that away. Same for them foreclosing on people instead of either renegotiating the loan or even just accepting interest only (thus lowering the payment by the equity portion), and having the poor schmuck still pay something, vs. having an empty house they still have carrying costs on (property taxes, etc.) and be getting $0 coming in. Wait till winter when the pipes burst, the walls split, and the houses go to hell. Then you'll have your housing market's equity value drop. Slums on Wisteria lane, who'd have thunk.

Between this, the idiotic $700B thing that gave zero help, and the inexplicable stock market free fall (how can stock of solid companies become so undervalued?), how can so many financial expert geniuses be so wrong so often?

p.s.: why don't they suspend forcing people to start cashing in their required minimum 401K distribution until this has passed? That would keep them from losing so much of their saved equity. Where's AARP on this? Oh, that won't happen, since it makes sense.

Standard Mischief said...

I can't really tell from the story what is really going on--

He's a sheriff, that usually means that he's an elected official. So this statement means that he's ether running for reelection, or running for higher office. Simple.

Matthew said...

As an elected official the sheriff seems to be doing right by the people who elected him. Isn't the law supposed to protect "the people" as opposed to the company?
I agree with the sheriff and think when it comes to a lot of people vs. a few banks the people should get the first consideration. 43,000 seperate foreclosures? Crap and Gloria! how many people is that affecting at least 60,000 or 70,000. A huge number.