As foreclosures mount, tenants suffer
Mortgage firms want buildings empty, evict even reliable rent-payers
James Evans, 77, has rented in the same Warwick Street apartment building in Roxbury since 1962. He has gone to Housing Court to challenge an eviction order by the bank, which has shunned a would-be buyer who would keep Evans in the building.
(Globe Staff / Mark Wilson)Stephen O'Brien wants to buy a foreclosed apartment building on Warwick Street in Roxbury. He wants to keep the ground-floor tenant, James Evans, 77, who is partially blind and living on Social Security.
But the company that is selling the foreclosed building told O'Brien it must be emptied of tenants before it can be resold, a standard industry practice.
"It's insane," said O'Brien, who lives near Evans and owns three apartment buildings in the neighborhood. "It's just obviously insane. And even if they're trying to manage it in a way that benefits them, then the problem is that they have absolutely no concern for the individual."
The situation - far from isolated - is another flash point in the accelerating foreclosure crisis. Foreclosed apartments increasingly are drawing interest from buyers who want to keep the current tenants, often to protect them and sometimes because reliable tenants are valuable. But mortgage companies say it is simply easier to sell an empty building, and more profitable to follow the same procedure in every case: Clear it, clean it, and sell it.
"You've got to figure, these banks are in California, they've got a gazillion properties, they think on a national scale," said Joseph Petrocelli, whose company, New England Property Solutions, is hired by mortgage companies to handle the sale of foreclosed properties, including Evans's building. "They do for the most part evict people from their homes because they now own them and that's how they want to sell them."
Buyers such as O'Brien could help to limit post-foreclosure evictions, a growing problem in Boston and other Massachusetts cities. Almost a third of Massachusetts foreclosures in 2007 involved multifamily buildings.
"We're looking to stabilize neighborhoods that we're afraid are reaching a tipping point of abandonment," said Joe Kreisberg, president of the Massachusetts Association of Community Development Associations. He said he expects some local community development groups to announce initiatives to buy foreclosed apartment buildings in the next few months.
The question is whether lenders and other companies that own these buildings will agree to sell the buildings with tenants still in them. O'Brien has been turned down twice. According to local real estate professionals, others who have inquired about buying foreclosed properties in Boston also have been turned away.
"It is either dogged idiocy or idiotic doggedness," said Judith Liben of the Massachusetts Law Reform Institute who has become a leading critic of how mortgage companies treat tenants in these situations. "They set up a rule and then they follow it without exceptions, without thinking about the reasons behind it."
When the Globe contacted Option One Mortgage, the company that manages Evans's building, a spokeswoman said there was no policy requiring evictions. While acknowledging that the company does routinely evict tenants, she said it would consider "any reasonable offer" for a property, even with tenants inside.
In a statement, the company also said it would not evict Evans, or anyone else, "during the holiday season."
O'Brien wants to build a business as a landlord so he can drop a desk job he dislikes. He heard about the foreclosure from Evans, who was sitting on the front stoop one recent day as O'Brien walked past. O'Brien saw an investment opportunity and a chance to help Evans, who has lived in the building since 1962.
In the tangled world of mortgage lending, it is often difficult for prospective buyers to know whom to call. Evans's building is owned by
O'Brien called the law firm that handled the foreclosure for Deutsche Bank. He wanted to inspect the building so he could determine a fair price.
"The lawyer I spoke to said they wouldn't let anybody in until everybody is out and they've cleaned it," he said.
He said he received a similar response from New England Property Solutions. Then, he tried to contact Deutsche Bank directly. No response.
A spokesman for Deutsche told the Globe, "We're going to decline to comment for the piece. We just don't see an upside in explaining this stuff."
Petrocelli said in an interview that he is willing to speak with O'Brien about a possible sale. He said he is trying to avert evictions from other buildings by arranging similar sales. He said he is sympathetic to Evans, but is limited by his instructions from Option One.
"This particular bank that owns that property will not allow it. But you know what? They need to be more flexible these days," he said. "As far as Mr. Evans, I'd like to see if I can help that guy."
James Evans and his wife moved to Boston from Alabama in 1959. He found a job as a sheet metal worker and an apartment on the third floor of a row house in Lower Roxbury. A decade later, the couple moved to the first floor, where they raised a daughter. He retired. His wife died.
Through it all, he said, he never missed a rent payment.
Then, in September, his longtime landlady knocked on the door.
"She told me, 'As of today, I don't own this building no more,' " Evans said. "I felt like she had hit me with a brick."
He soon received a letter from the law firm hired by Deutsche Bank, telling him to move out by the end of October.
It would not be easy for Evans to find other housing. He lives on a $1,281 monthly Social Security check. His monthly rent is $575, well below average for Boston.
Option One offered Evans a one-time payment of $500 if he left voluntarily. The second-floor tenant accepted a similar offer and left. The top floor has been empty for months.
Evans refused the offer, and instead is battling the eviction in Housing Court.
"I think this is really reaching crisis proportions," said Nadine Cohen of Greater Boston Legal Services, which is helping Evans in court. "We are going to see many more evictions, and right in the middle of the winter, and I would hope that people in the city and the state can really put some pressure on" the companies.
The case will go to trial later this month, but Evans already is packing.
"It's been a nice neighborhood for me all these years," he said. "But nobody seems to care about that."
Binyamin Appelbaum can be reached at bappelbaum@globe.com.
