Protections for renters in bank-owned buildings now in effect - Press Release

Community leaders and Aldermen want renters across Chicago to know that the City’s new Keep Chicago Renting Ordinance is in effect as of Tuesday, September 24.

Alderman Ray Suarez (31st), chairman of the City Council’s Housing & Real Estate Committee, made the announcement Tuesday in the Loop – accompanied by leaders of the Keep Chicago Renting Coalition and Aldermen Joe Moreno (1st), Walter Burnett (27th) and Deborah Mell (33rd).

The Logan Square Neighborhood Association (LSNA) is one of the key members of the Keep Chicago Renting Coalition, a coalition of community groups and unions that prompted passage of the ordinance in June.

The ordinance – officially known as the Protecting Tenants in Foreclosed Rental Properties Ordinance – makes Chicago the second largest U.S, city, after Los Angeles, to enact such protections for tenants.

The ordinance protects rent-paying, law-abiding tenants in foreclosed buildings.  When a building is sold at auction, the bank (or other foreclosing owner) must either keep renting to the tenants until the property is sold to a third party, or pay a relocation fee of $10,600 per household.

The new ordinance will provide direct help to thousands of Chicago families.  If current trends hold, an estimated 10,000 rental units will be sold through foreclosure auctions over the next year, with most becoming bank-owned, according to data compiled by the Lawyers’ Committee for Better Housing (LCBH).

In a survey of tenants who have been displaced by foreclosure, “over half of the households with children were forced to move their children to new schools as a result of their displacement,” said Patricia Fron of the Lawyers Committee, which also found that 50 percent of families had to move into temporary housing (with relatives or in shelters) after their buildings became bank-owned.  Some 31 percent of the families were faced with increases of $200 a month or more.

In addition to displacing families, foreclosures of rental buildings are creating vacancies that hurt the surrounding neighborhood, Ald. Suarez noted.  “Vacant buildings create a disaster for that block.  Vacant buildings bring property values down.  They bring instability onto that block.  And there’s no reason for it” other than bank policies to vacate the buildings as they take ownership, the Alderman said.

Community leaders said banks also use unfair tactics to push renters out, such as offering small payments to leave immediately, turning off utilities, and, as happened to one family in Albany Park, actually starting to board up a building while tenants were inside.  Now, if banks utilize such tactics, tenants can receive as much as $21,200 in damages."

“Our task now is to educate tenants about their rights under this new ordinance,” said Diane Limas, a leader with the Albany Park Neighborhood Council leader.  “We are calling on organizations across this city, churches, schools, and all of our elected officials to join us in our efforts to educate our communities.  Let’s make sure this ordinance works the way it was intended to.”

The Keep Chicago Renting Coalition includes the Albany Park Neighborhood Council, Action Now, the Brighton Park Neighborhood Council, the Chicago Coalition for the Homeless, the Kenwood Oakland Community Organization, the Logan Square Neighborhood Association, the Metropolitan Tenants’ Organization, Service Employees International Union (SEIU) Healthcare Illinois-Indiana, UNITE-HERE Local 1, and the Lawyers’ Committee for Better Housing.

Citywide, tenants seeking legal advice should call the Lawyers Committee for Better Housing at (312) 347-7600.
Tenants who live in foreclosed or bank-owned buildings in Logan Square, Avondale or Hermosa are encouraged to contact Tadeo Meleán of LSNA at (773) 384-4370 x15 or  (Tadeo is an Emerson National Hunger Fellow, working as an organizer at LSNA through February 2014.)

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