President Donald Trump’s administration and the Republican-controlled Congress passed a bill in May that rolled back Obama-era safeguards meant to prevent banks from making risky bets with depositors’ money and hopefully prevent another crisis of capitalism like the one that rocked the country in 2007.
You remember that one, right? The one where the housing bubble collapsed under the weight of bad loans bundled into toxic financial products, sending the world economy into a death spiral and allowing large corporations to buy up existing housing stock for pennies on the dollar, commoditizing a means of survival? There was a movie about it.
As it happens, the same bill that removes oversight requirements on certain banks relaxes them on others and arguably makes it easier for large, international banks to hold sway in the local financial sector also has a silver lining.
Slipped into the “Economic Growth, Regulatory Relief and Consumer Protection Act” is a small win for renters’ rights, a reinstatement of a law that guarantees that people renting homes that have been foreclosed upon will get 90 days’ notice to vacate the property before the bank-owner can evict them.
The hard truth is that even if you’ve done everything right, kept up with your rental payments and taken care of the property, you can still end up with an eviction on your record.
“In general, one thing that we know is that for certain groups of renters, like renters in foreclosed properties, for example, there are very few protections at all for state and local level,” said Tristia Bauman, senior attorney for the National Law Center on Homelessness & Poverty.
The law that Trump signed is, uncharacteristically, a measure that President Barack Obama signed in 2009 as the housing crisis continued to wreak havoc on the U.S. economy. That law contained a sunset clause for 2014. The new version has no such expiration date.
So, while the rest of the law frees some banks from the level of regulatory burden that lawmakers living through the Great Recession felt necessary, it also provides some measure of protection for renters who might otherwise find themselves unexpectedly evicted from their homes.
“We have fought for years to have this common-sense renter protection permanently enacted,” said Maria Foscarinis, executive director of the National Law Center on Homelessness & Poverty. “But it’s disappointing that the act comes in a wave of regressive policy that undermines accountability for fair lending practices.”
The new measure is unlikely to have a huge effect in Washington state, where the Legislature took it upon itself to guarantee renters a 60-day notice prior to being evicted from a foreclosed property. It will give renters another 30 days, said Mark Chattin, directing attorney at the Legal Action Center, an organization that helps low-income people through eviction proceedings.
Adjusting state law likely isn’t high on the priority list, Chattin said, as housing advocates are more focused on changing the three-day “pay or quit” notice that allows landlords to begin the eviction process three days after a tenant misses a full rent payment.
Chattin and his attorneys haven’t dealt with a foreclosure eviction since 2009, when the original law passed.
Finding ways to prevent eviction is critical to the ongoing fight against homelessness, even if the party in question does not end up staying in the unit. Having an eviction on your record makes it very difficult to find another rental unit because evictions show up on future tenant screenings.
Government leadership has begun to take greater notice of the toll that evictions take on their population, particularly single Black women, who, studies have shown, make up a large number of eviction cases in many cities. New York City provided a right to counsel to ensure that anyone who goes to court for an eviction will have an attorney working with them, and a similar measure passed in San Francisco on June 5.
Ashley Archibald is a Staff Reporter covering local government, policy and equity. Have a story idea? She can be can reached at ashleya (at) realchangenews (dot) org. Follow Ashley on Twitter @AshleyA_RC
Wait, there's more. Check out the full June 13 - June 19 issue.
Real Change is a non-profit organization advocating for economic, social and racial justice. Since 1994 our award-winning weekly newspaper has provided an immediate employment opportunity for people who are homeless and low income. Learn more about Real Change.