Ben Sin, a journalist with The Village Voice, has been featuring the foreclosure crisis several times a week in order to highlight the persistent problem facing our country and city. In a city like New York, where the majority of residents rent, foreclosure is complex, complicated, and not always black and white. The media often portrays foreclosure as a battle between defaulter (innocent) and bank (evil) are not useful in all cases, as it show little awareness of tenants’ rights and the myriad of options foreclosure can present.
First and foremost, tenants in rent regulated units cannot be forced to leave their home as a result of their landlord defaulting on his or her mortgage. For New York City tenants, foreclosure does not go hand and hand with eviction and this basic right needs to be understood by those who claim to tell the story of New York City foreclosures. Furthermore, because of a process known as predatory equity, by the time a multifamily building falls into foreclosure it is usually in terrible condition. A landlord struggling to cover inflated mortgage payments based on a speculative loan is unlikely to make repairs. In cases like this, tenants widely see foreclosure as an opportunity to kick their slumlord to the curb (with the help of the bank) and bring in a more responsible actor, or perhaps even buy the building themselves and convert it to a low-equity co-op.
We do not want to represent that foreclosure is an easy opportunity to NYC renters. Banks are eager to get as much money back for their non-performing assets as possible and in doing so overlook tenants’ interests. Rather than allowing speculative private equity groups to buy buildings, banks should be pushed to negotiate fair prices and responsible sales with tenants and allies. This is the story that Mr. Sin and other journalists writing about foreclosure should be pushing. This is the action that Occupy Wall Street should support. Stopping foreclosure auctions is not necessarily what is important in multifamily foreclosures, though stalling the auction could potentially allow tenants more room to insert their voice into the process. Alternatively, it could leave them suffering in poor conditions under a receiver for many more years. Saving buildings from predatory developers who will run the building deeper into the ground and removing the option of long-term affordability is what we should be talking about.
Ben Sin’s beat on foreclosure demonstrates a simplified understanding about what foreclosure means in New York City. By ignoring crucial pieces of information and real communication with tenants, stories being told in The Village Voice are misleading. For example, in his article “Singing Protesters Strike Again; New School Students Interrupt Foreclosure Sale,” Sin writes:
The tenants of 556 Evergreen Avenue in Bushwick, which was one of nine properties set to be sold at the auction, did not show up to the auction. But when told of the blockade, Luis Mendoza, a handyman who lives on the second floor, were obviously relieved.
“So some kids saved our building from being sold today?” he answered. “I wish I was there, I would have played guitar to the song.
The building highlighted, 556 Evergreen Ave., is in HPD’s Alternative Enforcement Program, meaning it has very high code violation and has been flagged as one of the 200 worst buildings in the city. This shows that the property owner, Moody Amar, is probably not a very responsible landlord. Why should we block the transfer of this building to a new owner? What happens when the building switches hands? Will the new owner clear code violations with patchwork repairs, or will tenants fight to correct the underlying conditions and fix code violations behind the walls? What opportunity do tenants have to support a good, HPD-and-tenant vetted buyer to win the building at auction? This is the story Mr. Sin should tell in his foreclosure beat behind the buying and selling of distressed, foreclosed buildings.
The foreclosure process in New York City takes an unreasonably long time, adding to already difficult living conditions for tenants. Court appointed receivers are often placed in buildings and have little or no concern for tenants, and rarely have the energy or funds to make necessary repairs. When thinking about the multifamily foreclosure in New York City, the question is not how to prevent the foreclosure process from taking place, but rather how to finish the process quicker while simultaneously pressuring banks into doing the right thing.