If your landlord is being foreclosed, it means that he or she has missed payments on their home loan and the bank is attempting to take the house as compensation.
Yes. As a tenant living in a foreclosed property, the bank is likely going to try to evict you and everyone else in the house so they can sell it. This is called a no-fault eviction because it isn't your fault that you are being evicted.
Do not move out. Force the bank to go to court to evict you. Even if you are told that you need to leave tomorrow, it could take the bank 20-30 days to bring the eviction to court and have it approved. This will at least give you time to determine whether you want to fight the eviction or find new housing and move out. If you move out, you will not be offered cash-for-keys (see page 2).
Do not pay rent to your landlord. He or she does not own the building anymore and is no longer your landlord. You are now a tenant of the bank that owns the building, but the bank will usually not collect rent. Save that money instead.
Call a lawyer. A lawyer can negotiate with the bank and give you legal advice. If you do not have a lawyer, contact Rhode Island Legal Services at 274-2652.
A cash-for-keys deal occurs when the foreclosing bank offers tenants money to move out faster and without going to court. This is a good deal for the banks—they save the time and effort it would take to evict you if you stayed—and you have to decide whether it's a good deal for you too. Here are some things to consider:
Offer to pay rent to the bank. You should write a letter to the bank and to tell them you are willing to pay rent and ask who that rent should be sent to.
Make the bank take responsibility. The bank owns the building, so they are also responsible for maintaining it. Report any problems in your apartment or building to the bank and ask that they be fixed. Tell them that they need to keep paying the utilities as well. Report housing code violations to Providence City Hall—call 421-7740 and ask to talk to Minimum Code enforcement.
Offer to buy the building. The building in which you are living is probably worth much less than it was when your landlord bought it. If you know how much it is being sold for and you can afford it, tell the bank you would like to buy it. If that price is too high, you can have the home evaluated by another company and offer to buy at that price. For assistance, contact a local nonprofit community development corporation (CDC) or the RI Housing Help Center at 457-1130.
Save your rent. Because the bank will not collect rent from you, put aside the amount you would be spending so you will have money for a security deposit on another apartment.. Remember, you may also have to pay for moving expenses (truck rental, storage, etc.).
Find another place to live. If you need help finding an affordable place to live, call 2-1-1.
You are entitled to get your deposit back. If your landlord will not return your deposit, you can take him or her to small claims court to get your money. This process may take a long time if your landlord has declared bankruptcy, so do not expect to have your money back immediately.
The bank that owns the building is responsible for paying utilities. If your water has been shut off, it means that the bank is not paying the bill. Call Legal Services at 274-2652—they will help you to get the water turned back on. You should also report the violation to Providence Neighborhood Services at 421-7768.
Call Legal Services (274-2652). A lawyer there should be able to talk with the utility company to get these turned back on.
The most effective way to stop foreclosures is by coming together with your neighbors. When we speak together to say we want safe, strong neighborhoods and protection for tenants and homeowners, we have the power to create change in our communities and in our state.
To join the community effort against foreclosures, call Housing Action at 521-1461.