The fifty states and the federal government sued the largest five banks in the United States in 2012. The lawsuit dealt with numerous improper practices, foreclosure abuses, and failures by these institutions to deal with consumers in a fair and reasonable manner. Unfortunately, even though this lawsuit has been settled, foreclosure abuses still continue.
Lisa Madigan, the Attorney General for the State of Illinois, has recently brought another lawsuit against large financial institutions related to continuing foreclosure abuses that were supposed to have been eliminated by the prior lawsuit.
Property Management Company Abuses
Banks hire property management companies to maintain homes that have been left vacant by the homeowners. These property management companies first have to determine whether the home has been abandoned.
The largest property management company is called Safe Guard. The lawsuit brought by the Attorney General of Illinois claims Safe Guard breaks into homes which are occupied. When they break into homes they cause extensive damages and they improperly remove personal property. They also change the locks. They contact the utility companies and turn off the utilities. In addition, Attorney General Lisa Madigan claims, in her lawsuit, they force occupants into leaving their homes even though they have the legal right to stay. There are economic reasons for these property management companies acting improperly. It turns out the property management companies make more money taking care of vacant homes than dealing with homes that have not been abandoned. The reason for this is vacant homes that have been abandoned, by their homeowners, require more supervision. They need to be boarded up, locks need to be changed, the grass needs to be cut, the homes need to be secured against vagrants moving in, and they need to be looked after on a regular basis.
Illegal Eviction
Eviction involves a legal proceeding where a homeowner takes action through a court to remove a tenant. Even if a bank obtains title to a house in a foreclosure lawsuit it cannot send some men to the house to use strong arm tactics to force the homeowner to leave. The bank, if they want to obtain occupancy of the house, has to bring a landlord/tenant proceeding in a landlord/tenant court. Tenants have rights!
Banks must observe the rights of the occupants of homes. Even after a bank takes title to a home in a foreclosure case the former homeowner becomes a tenant and is subject to all types of tenants rights. Banks must observe these rights!
Elliot S. Schlissel is a foreclosure attorney. For more than 45 years he has represented homeowners in disputes with financial institutions. His office litigates matters against banks and other financial institutions throughout the metropolitan New York area.
