Don’t Forget the Renters
We ran a piece this morning about the various pressures on Democrats as they negotiate the delicate task of crafting a foreclosure-relief bill that satisfies consumer groups but also appeases Republicans in the Senate and White House.
The tale focused on the absence of homeowner-friendly bankruptcy language that would give courts the power to force lenders to renegotiate the terms of troubled mortgages.
Left unmentioned was the absence of another provision that consumer groups have pushed for: One to help renters living in homes and buildings facing foreclosures because the have defaulted. Often ignored, their numbers are significant. Barbara Sard, director of housing policy at the Center on Budget and Policy Priorities, estimates that more than 30 percent of those affected by the turbulent housing market are renters, who tend to be of lower incomes (and thus less able to weather the storm).
Moreover, banks that repossess homes tend to evict tenants, rather than opt to play landlord, Sard said. In the mix, security deposits often disappear.
Among the various House bills currently under serious consideration, none tackles this issue head on. The Senate housing bill that passed earlier this month ignores the issue as well. That doesn’t mean it can’t show up later: There’s plenty of debate left before this thing is finalized. But leaders in both chambers have their work cut out if, as they say, they want the proposal on its way to the president’s desk before Memorial Day.
And this is particularly true if they want to stay on the right side of the consumer groups.