Protecting Tenants From Irresponsible Landlords

Residential tenants throughout the United States are experiencing an increasing number of landlord foreclosures and bankruptcies. Renters who diligently paid their rent on time are finding themselves literally thrown out into the streets when the landlord’s mortgage is foreclosed. Financially troubled landlords are also deferring or neglecting basic maintenance services such as trash pick up. In many instances, the landlord is even neglecting to pay the water bills or common area electric bills resulting in utility shut offs. Because of these irresponsible actions tenants’ health and safety are being endangered.

One of the American Tenants Association’s most important goals is to elevate for public discussion the issue of landlord foreclosures and the denial of basic services in cases of landlord bankruptcies. In addition, tenants’ security deposits are at risk when the landlord declares bankruptcy.

Here’s a summary of our main objectives to address this problem.

· Require that tenant security deposits be held in legally segregated escrow accounts and not be co-mingled with landlord operating funds. Tenant security deposits shall remain the asset of the tenant subject to assignment in the event of damages.

· Require landlords to certify in writing at the time of lease signing that they are current on their mortgage, utilities and maintenance accounts.

· If landlord is unwilling to certify current status, rent payments will be held in escrow to be paid directly to mortgage holder and providers of tenant services through a legal escrow account.

· Require landlords to immediately notify tenants, in writing, if they become delinquent with mortgage, utilities or maintenance accounts.

· Require that tenants not be evicted from foreclosed properties until lease expiration. If no written lease, tenant shall have 90 days to vacate the property.

· If the landlord requires a credit report from the tenant, tenant shall have the right to the landlord’s credit report.

· Change the status of landlord to one of a fiduciary or trustee of tenants’ funds

The ATA is actively reaching out to progressive state legislators who understand the plight of tenants in this economic environment.