Tenants Suffer As Landlords Face Foreclosures

In a short span of just seven days after Natasha Sinclare moved into a new rented apartment, she found out that her building was in the midst of a foreclosure battle as the landlord had defaulted on his mortgage payments. Thankfully, under New Jersey law, tenants like Natasha have special rights. Still, people advice that renters should be careful that they are not taken advantage of by their landlords.

Natasha was wondering that “Why would he do this to me?” An unemployed mother of five children, Sinclare, who is 29 years old, was worriedly pacing around in her apartment last month. She added that “I don’t want to be left out in the cold with my five kids.”

As statistics do not track the figure of renters who are displaced due to foreclosure, advocates say that this problem is fast becoming a rising problem, and people like Sinclare suffer, as the city rates 2nd highest in the state as far as the number of foreclosures are concerned. In the past year alone around 2,246 properties were listed as being in different stages of foreclosure, according to Mayor Jose Torres.

According to the President of the Hackensack-based New Jersey Tenants Organization, Matthew Shapiro, says that he is aware of certain cases where new landlords have been intentionally misleading their tenants or cutting off their water and heat as soon as they are in control of the building premises. He added “Tenants have to be aware that this kind of action is criminal. It’s a disorderly offense.” He said that there were times when landlords may offer money to tenants so that they will leave sooner. Matthew said “The offer is usually couched in terms like, ‘Well, this place is in foreclosure so you are going to have to leave anyway,’Ÿ” he added “It’s a con and it’s completely unethical.”

In Natasha Sinclare’s case, court documents showed that Richard Kapusta, the landlord, had received a defaulter notice in May last year from the lender, National City Mortgage. According to Tamara Kendig, a spokesperson for the state judiciary, another notice was sent in January this year that orders the sheriff to sell the property in order to satisfy the foreclosure judgment. When contacted in late February, Kapusta refused to comment to any reporter’s questions.

The date on Sinclare’s one-year lease copy with Kapusta is Jan. 27 2009. According to the lease agreement, she has paid Kapusta a deposit of $700, one month’s rent, for her 3 bedroom apartment.

The good news – Gregory Diebold, director of litigation for Northeast New Jersey Legal Services, says “As long as the lease was signed prior to the sheriff’s sale that the tenant was legally there and that the tenant couldn’t be evicted as a result of foreclosure judgment.”

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