For Immediate Release


Renee Willis, Vice President for Field and Communications
Ph. 202-662-1530 x. 247

Report Released: Renters in Foreclosed Properties May Face Homelessness

WASHINGTON - Foreclosures are driving an increase in
homelessness across the country, according to a new report by the National Low
Income Housing Coalition (NLIHC) and the National Law Center on Homelessness
& Poverty (NLCHP), and with pro bono assistance from the law firm of

Renters of foreclosed
properties are among those most at risk of homelessness, but their plight has
received little attention. Without
Just Cause outlines the rights, and lack thereof, for renters in
foreclosure in all 50 states and the District
of Columbia.

About 40% of families
facing eviction due to foreclosure are renters whose landlords have defaulted
on their mortgages, and these renters have little protection. If a landlord is
foreclosed upon, tenants who have diligently paid their rent on time may face
eviction without notice, coming home to find locks changed and their belongings
on the street. Some local sheriffs, such as Sheriff Tom Dart of Cook County, IL,
made headlines for refusing to evict renters in these cases.

The status of renters in foreclosure cases is a matter of state law,
and laws are complex and vary among the 50 states and the District of Columbia. In practice, there are
often even fewer protections: even if they have rights, many renters are often
unaware of them, and few have easy access to lawyers, who may also be unaware
of tenants’ rights.

Major findings of this report show:

  • Only 33% of states
    (17 states) require any type of notice to tenants.
  • Only 29% of states (14
    and DC) require a judicial process for foreclosure.
  • In several states
    (e.g. FL, IO, WI, NY, OH) tenants may remain only if they are not named in
    the foreclosure proceeding.
  • Only 2% of states
    (NJ and DC) explicitly preserve tenants’ rights in the lease after

Only 23 states provide some exceptions that may preserve tenants’
rights.  For example: 

  • In Connecticut, tenants who are elderly,
    disabled, or receive federal housing subsidies (“Section 8”)
    are protected and their tenancies preserved.
  • In Illinois, if tenants are not named in
    the foreclosure proceedings, they can maintain their lease, subject to the
    filing of a “supplemental petition” by the lender.
  • In nine states, the
    lease may be protected if it
    predated the mortgage, depending on mortgage terms.

“This lack of protection for law abiding renters can result in
families losing their homes, children changing schools, and communities being
destabilized unnecessarily,” said Danilo
Pelletiere, NLIHC Research Director. “Renter protections
are important to stopping the cycle of decline.”

response, NLIHC has called on Congress and the Administration to provide:

  • $10 billion for the National Housing Trust Fund
    over 2009-2010 to rehabilitate or build 100,000 rental homes for the
    lowest income households using green standards.
  • $2 billion in Emergency Shelter Grants, for
    homelessness prevention and housing assistance to prevent low income
    renter households from becoming homeless, and to rapidly re-house those
    that do lose their homes; 400,000 households would be assisted.  
  • 400,000 new housing vouchers over 2009-2010,
    which would assist another 4000,000 low income families afford modest
    rental housing in what is likely to be a tightening market.
  • Legal protections for tenants in properties subject
    to foreclosure, including the requirement that existing leases and
    contracts be honored by new owners and in the absence of a lease, renters
    be provided with at least 90 days’ notice before eviction. 

“Roughly 40% of the families facing eviction are renters and in
some cases they receive as little as one week between foreclosure and eviction.
These families have limited time and limited resources to find new housing, and
without action, an increase in homelessness is imminent,” said NLIHC President
Sheila Crowley. “Congress and
the Administration must take the needs of those suffering the most in this
recession into consideration.”

The report Without Just Cause
can be found at:


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The National Low Income Housing Coalition is dedicated solely to ending America’s affordable housing crisis. Established in 1974 by Cushing N. Dolbeare, NLIHC educates, organizes and advocates to ensure decent, affordable housing within healthy neighborhoods for everyone. NLIHC provides up-to-date information, formulates policy and educates the public on housing needs and the strategies for solutions.

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