Friday, November 12, 2010

Landlord Bill White Turns Water off on Unpaying Tenants

Once landlord Bill White's tenants found out that he lost a half a million dollar lawsuit all of them with exception of 2 stopped paying their rent. The one complaining in the video has not paid her rent. White turned off the water and the tenants illegally turned it back on so the Water Authority understandably took the meters. White turned off the water to all of the units just like Gunther Gass did and the links below are the result of what happened to Gunther from one single house. The Water Authority turned all of their water back on apparently deciding to give them free water likely seeing that the media coverage would end up getting them dragged into court on this issue as well.

Gunther Gass turns off Water

Gunther Gass loses Thirteen Thousand

Thursday, November 11, 2010

Foreclosure system ripe for errors in Virginia


The state has one of the fastest-moving systems in the country, and one lawyer said flaws are likely common.

By Laurence Hammack
 981-3239 Roanoke Times

M.T. Warden's home in Salem was sold in a foreclosure two years ago, but he sued the mortgage company and won back his house when the company wasn't able to produce proper documents.

The day his house was sold at an auction on the steps of the Salem courthouse, M.T. Warden said he didn't even know he was facing foreclosure.

He knew he was several months behind on his mortgage. When he called American Home Mortgage Servicing to make a payment, Warden recalled recently, "they said my home had been sold, and I didn't live there."

That was news to Warden, 30, who, at the time, was sitting in the kitchen of his Valleydale Road home. The next week, he found an eviction notice taped to his front door.

Rather than move, Warden filed a lawsuit challenging the foreclosure. After his attorneys found flaws in the paperwork leading up to the Dec. 2, 2008, auction, the case was settled last year and Warden was allowed to keep his house.

It was a rare win for a homeowner in Virginia, which has one of the fastest-moving foreclosure systems in the nation, according to consumer advocates. Foreclosures can be carried out in as little as 15 days -- less time than it can take to evict a renter.

"There's no doubt that Virginia is one of the leaders in getting people out of their homes quickly," said Ira Rheingold, executive director of the National Association of Consumer Advocates. "Its laws are designed to help the banking industry, not the homeowners."

In recent weeks, foreclosures in Virginia and across the country have fallen under increased scrutiny in the wake of revelations that some mortgage lenders cut corners and falsified documents in their rush to take houses from struggling borrowers.

Attorney General Ken Cuccinelli joined his counterparts in the other 49 states in a national investigation into foreclosure practices.

It's unknown just how many forced home sales in Virginia might have been affected, and to what degree. Tom Domonoske, a Harrisonburg attorney who represented Warden in the disputed Salem foreclosure, said he believes the flaws uncovered in that case are common.

After Warden fell behind in his payments in fall of 2008, an official with Dallas-based American Home Mortgage Servicing signed a document initiating the foreclosure, asserting she had power of attorney to act for the lender, U.S. Bank.

The foreclosure fell apart when the mortgage company could not produce the power of attorney -- a document that Warden's lawsuit claimed never existed.

"It was just part of a shortcut they were taking," Domonoske said of the missing document.

"Virginia allows the quickest, easiest foreclosure practice in the country, and it's still not quick enough for them," he said, speaking in general about the practices of mortgage service firms and others involved in the foreclosure process.

"It's cheaper to cheat," Domonoske said. "If you cheat, you can get more money in your pocket."
"Please be advised ..."

Nine years ago, Warden took out a loan to buy a modest, white frame house that sits amid shade trees on a quiet street in West Salem. Assessed at $105,000, the house and two-acre plot seemed like the perfect starter home.

"I thought I was doing pretty good," Warden said. "There aren't that many 21-year-olds who go out and buy a house."

Warden, a home improvement contractor, didn't have any problems with his monthly mortgage payments of about $700. But after his daughter was born in 2005, he decided he needed a car.

To get some extra cash, he refinanced his home. The arrangement gave him $5,000 up front, but left him with an adjustable interest rate that in a couple of years nearly doubled his mortgage payments.

"Looking back, I should have found another way to get five grand, but I was just 25 years old," he said.

About the same time, Warden decided to form his own home improvement business. Times were tough, and it wasn't long before he started to have trouble paying bills.

On Oct. 29, 2008, a law firm that had been appointed the substitute trustee by the mortgage company -- which in Virginia is usually a sign that foreclosure is imminent -- sent Warden a certified letter.

"Please be advised that this firm has been requested ... to institute foreclosure proceedings," read the letter from Bierman, Geesing & Ward, of Bethesda, Md.

Warden never got the letter because his mailbox had been knocked down during a traffic accident, he said. But that doesn't matter, according to Domonoske. Virginia law requires that notice be sent to a homeowner within 14 days of a sale -- a burden the law firm met -- but failure of delivery does not necessarily invalidate a foreclosure, he said.

State law also requires that a foreclosure be advertised in a local newspaper at least twice in the 14 days before a sale. Had Warden known to scour the fine print of legal advertisements in The Roanoke Times, he would have seen two ads in November for a trustee's sale the afternoon of Dec. 2 on the steps of the Salem courthouse.

Warden said he never saw the ads. At the auction, his home was purchased by the lender, Minneapolis-based U.S. Bank.

About that time, Warden said, he contacted American Home Mortgage Servicing and offered to make good on his payments. "It was odd," he said, "because I was trying to give the people money, but they were refusing the money, saying it was too far gone."

It was only after Warden went to Roanoke lawyer Roy Creasy, and later Domonoske, that the two attorneys were able to set the sale aside by filing a complaint in Salem Circuit Court.
The lawsuit claimed that American Home Mortgage Servicing lacked the power of attorney it claimed to have from the bank when it appointed the Maryland law firm substitute trustee.
Three months later, the case was settled. Warden was allowed the keep his house, and the foreclosure did not affect his credit rating.

An attorney with Bierman, Geesing & Ward declined to comment. A call to U.S. Bank, which was named as a defendant in the lawsuit along with American Home Mortgage Servicing, was not returned. Equity Trustees, a branch of Bierman, Geesing & Ward, was also named as a defendant.

A spokeswoman for American Home Mortgage Servicing declined to comment on Warden's case but defended the company's general practices.

"We have spent an enormous amount of time over the last few weeks reviewing our foreclosure practices," Philippa Brown said.

"We have very strong processes and procedures in place to ensure that our officers who sign affidavits and similar documents are appropriately reviewing those documents and validating the material."

The foreclosure mill
Although Warden fought the system and won, many homeowners in the midst of foreclosure don't have the money, time or fortitude to follow his example.

Unlike when renters are evicted, there is no judicial oversight of foreclosures in Virginia, unless the homeowner files a challenge. Virginia is one of 27 states that does not require judicial approval. In the states that do, the process can take much longer -- six months or more.

"The lack of protection for homeowners is just amazing to me," said Jay Speer, executive director of the Virginia Poverty Law Center.

In Virginia, the process can be completed in as little as 15 days, after the 14-day requirements for notification to the homeowner and legal ad are satisfied, Domonoske said. The normal time in Virginia is 45 days, according to RealtyTrac, which tracks foreclosures.

For years, foreclosures were relegated to the fine print of legal ads and the sparsely attended auctions outside courthouses, where, often, the only bidder was a bank taking a home back to recoup its loss.

But after the housing market crashed in 2008 as subprime borrowers defaulted, attention eventually turned to the foreclosure fallout.

As the number of forced sales soared, attorneys for some homeowners began to question the paperwork from mortgage lenders and their law firms, dubbed "foreclosure mills" for their large-volume specialty.

In depositions, bank officials admitted that they had not read the affidavits and other documents they signed en masse, a practice known as "robo-signing." Some of the lenders -- including Bank of America, GMAC Mortgage and JPMorgan Chase & Co. -- suspended foreclosures while investigating their practices.

Banks have argued that any mistakes were technical and that the people being foreclosed on were in fact delinquent.

"Our ongoing assessment shows the basis for our past foreclosure decisions is accurate," Bank of America said in a statement.

Although many foreclosures have resumed, the investigation continues by the coalition of all of the nation's attorneys general.

In the end, Warden admits he was late paying his mortgage and that he shares some of the blame. But he's troubled by the way delinquent homeowners are treated by a banking industry that received a bailout from the United States government.

"As far as the foreclosure goes, banks are going to do whatever they want to do. They always have," Warden said.

"What irritates me is they get all the money from the bailout because they were going to go under. But everybody who is being foreclosed on -- we don't get squat."

Monday, November 1, 2010

A Rundown of the Eviction Process in Virginia For PROP Proponents


This is for those who are not familiar with landlording in Virginia. It will explain the eviction process and the time it requires to do so.

The case at hand I'm using as an example is one in which there is a tenant in a house that is causing problems for neighborhoods. In the case of a tenant not paying rent you would start with a 5 day pay or quit.

Most of our tenants already know what they are what they are not supposed to do. Our leases are often very heavily worded requiring the tenant to behave in their community. Unfortunately, sometimes the tenant you think will be best will do an about face and end up being the worst tenant you have.

Keeping the yard free and clear of trash, mowing on a regular basis, not causing disturbances of any kind to the neighbors, etc. The problem is that if they pay their rent the landlord is required to give a 21 day notice to remedy. Can't give a 5 day pay or quit. And if not remedied within 21 days the 30th day the landlord can file for eviction. If they fix the problem within the 30 days and let it happen again next month or whenever in the future, the law requires that the landlord files "another" 21 day notice to remedy. And that has to go on and on until they mess up and don't remedy the issue within the given period of time. If the landlord unlawfully files for eviction prior to the given period of time the Judge will not only throw out the case but legal aid will sue the landlord for triple damages.

There is even more to it beyond the 30 days to remedy that is in a landlords way of terminating a tenancy within a reasonable amount of time. Once we can get to the point where we can file for eviction, we have at least 3 weeks to wait for a court date.

If the tenant says the words "I contest" and the judge often leads them to do so by asking them if they contest, the judge will give them a couple more weeks to return to court to prove that they have not caused the violation of the lease at hand.

Sometimes on that 2nd court date the tenant will call up and have it continued which gives them another couple weeks. They will only allow them to continue the case 1 time. And on that final court date, if the judge sides with the landlord, the judge will grant "possession" of the property to the landlord.

The landlord is then required to wait for 10 days before filing a "writ of possession" which is basically getting the sheriff to come out and allowing the landlord for the first time to physically remove them and their property from the dwelling. The 10 days is to give the tenant a chance to "appeal" the judges decision.

If they appeal it the process drags out even further.

Once the writ of possession has been filed the sheriff typically will give the landlord a call within 3-4 days to schedule a time to come out.

The sheriff by law has up to one month to meet the landlord and get the people out. Most often the sheriff does not wait for the month but will schedule the time for about 2 weeks from the date that they call you.

Best case scenario, the tenant "doesn't" show up to court on the first court date so they don't contest and there are no problems. In this case you have them out in 1.5 months from the date you file for eviction... which is already "at least" 30 days beyond the time where the neighbors called with issues that the tenant is having.

And normally the landlord will first attempt to resolve the issue with the tenant by requesting that they stop what they are doing before jumping the gun and giving them the written 21 day notice to remedy the second they get their first call. So in best case scenario we have 2.5 months if the landlord gives a notice to remedy on the very first call.

And if the tenant shows up to court as you can see above from the notice to remedy + the court dates you're looking good if you can get them out in 5 months.

At this point in time the neighbors are burning up thinking the landlord isn't doing anything about it through this very long legal process. And we are burning up as well. Because the minute we give them that notice, quite often they stop paying rent. So we now have deadbeat tenants but still have to pay the mortgage throughout that time, and furious neighbors calling up thinking we aren't doing anything about it. Meanwhile we have a tenant tearing up our house because they are mad at us for trying to get rid of them and calling code enforcement on the damage THEY just created. And code enforcement is all over us about fixing the TENANT damage.

So everyone is mad at the landlord but the anger in my opinion is most often misdirected and should be focused on the legal system and the politicians who decided what's best for the tenants with complete disregard to the landlords and the neighbors.

For those who are thinking it is a case of improper tenant screening, you are wrong. Most of us screen our tenants because we don't want the drama and loss of income associated with not doing so.

I see the root of the problem as being a characteristic of a different socioeconomic class of people than the property owners within the neighborhoods and is part of having diversity of various economic backgrounds living amongst each other; which is a goal of the city. Therefore good solutions would include a speedy removal of tenants that are disturbing the neighborhood. One man can not justly be blamed for the actions of another.

Problems associated between neighborhood associations and landlords can easily be fixed but it requires communication in doing so. REI of Roanoke has solutions to the issues at hand which will require the support of the Roanoke City judicial system and Roanokes Legal Aid in working with landlords and neighborhood associations on a specific law within the Virginia Landlord Tenant Act that gives room for speedy judgment on drug related issues but is not presently clear enough for a landlord to act upon tenant / neighbor problems other than something drug related.

Force (PROP) by any means is not only a form of tyranny but it's an abuse of power and the outcome of this oppression will not be beneficial for any side. Good communication is always the solution to an issue but for some reason there has been a major lack of communication in Roanoke.

Honestly I'm not understanding why the neighborhood associations and city have gotten together without inviting the leading investment group in Roanoke, REI of Roanoke.

Proposed Local Legislation - The Evil Rich Landlord Will Now Be Punished For What Their Tenants Do


We have some very serious stuff coming our way. The city and neighborhood associations are planning a full out attack against landlords. They have been working with neighborhood associations for months about this plan. REI's lack of organization and not having every landlord in Roanoke as a member of our group has caused some serious problems. The City of Roanoke sent people down to Raleigh to learn about their extreme hardline force they put upon landlords.

I researched Raleigh's Probationary Rental Occupancy Permit program (PROP Program) and it's very bad. If the tenants don't mow their yard, you're royally screwed. If the tenants cause disturbances to the neighbors you're screwed. If they tell you to fix something and you don't do it within the time required, you're screwed.

Lets say you bought a place and are fixing it up and the code enforcer failed you on the first shot which can easily happen. Then the tenants move in and you get a violation that they didn't cut the grass. Then later you get another violation that they didn't cut the grass. And at one point in time the cops were out there for your tenants because the neighbors called. 4 violations including cop violations and your property goes on the probation PROP program. There are many ways your property instantly goes on the program. You will have 10 days to file a prop application (lol, they make you apply for the probation) If you don't apply in 10 days you are prohibited from renting the unit.

This is very serious oppression!

If you fail to send in the PROP application you will be fined $50 per day until the application is completed and returned. You must pay a $200 application fee to apply to be on probation even if you send it in on time. + if it's your first violation on the property you automatically get a $50 civil penalty to go along with the first $200 you will pay.

Then when you get on PROP you will immediately be sent a temporary permit until the real permit is issued. Once you get the real permit you will be required to pay $300 for it for the first year and $500 for it for each year thereafter. The fee will be in addition to other code enforcement citations and fees that they will charge you. You also must get your application to get screwed notarized.

Here's what happens if your tenant doesn't mow the yard or a neighbor who doesn't like them or you and calls the cops on them for some bogus reason.

EACH of these warnings that you get while you are on prop will get an additional $200 administrative fee tacked on to the other fees.

First violation while on PROP and you get a $50 dollar civil fee and $50 per day until the violation is resolved, plus the $200 administrative fee.

On the second warning they will give you a notice that they may suspend your right to rent the unit. (as if it was a privilege to rent a house or something) This second warning comes with a $250 civil fine. And $100 per day civil penalty until the violation is in compliance. And on the 2nd violation the permit is revoked for that unit for 2 years.

A third violation results in a $250 civil penalty and $250 per day until you comply to your superiors.

Other things about PROP.

If you are sent a letter from code enforcement saying that you are "eligible" for PROP and don't respond these fines will accrue on a daily basis.

You can appeal it. You will send a letter of appeal to the director of inspections (Tom Carr or Dan Webb?) and if he doesn't approve it you can appeal a 2nd time to an arbitrator but if you lose you will be responsible for an administrative fee of $200 and half the costs of arbitration. Then you can appeal it one more time to city council (I believe in Roanoke there is a charge to do this as well) and you are not allowed to present any NEW evidence when speaking to your leaders.

* If you rent out the house without first getting a certificate of compliance you're instantly on the prop program.
* Reoccupying a house that the city condemned you're instantly on it.
* If your tenants get a third conviction for violating the Cities nuisance party ordinance. (having a party where the cops are called by the neighbor) They don't have to be convicted of anything. Just 3 complaints. That's it. And each time you as a landlord will get sent a civil penalty by the cops. THIS IS THE PROGRAM THAT CHRIS PERKINS TOLD US HE'S GOING TO SUPPORT. I've looked high and low for this thing he said that will help landlords get tenants out and there is no Virginia bill that is being introduced like that. I'll bet that Roanoke will add something to this horrible Raleigh program to help us get them out. In an attempt to try to look like this program is fair to landlords and only "those who don't care about their property" will get screwed. I guarantee you they will position it that way! They will give a warm and fuzzy feeling to those who are easily convinced and will not disclose all of the details until they voted in city council on it and made it LAW of Roanoke City only.
* If any tenant on your property has been convicted of a crime 3 times in 2yrs you get put on the PROP program.
* Failure to repair, demolish or vacate the house within the granted time-frame that they require you get on it.
* If more tenants move into the house than are allowed to be there you're instantly on it. Violation of zoning density.
* If you have unlicensed or un-inspected vehicles or a vehicle that the tenant has partially dismantled because they are working on it you are on the probation program.
* 2 nuisance abatement violations within 2 yrs and you're on it.
* 4 notices of any violation within a 2 year period even if you corrected the problems or got the tenant to mow or stop causing drama or whatever.

However, you still must follow all of the guidelines for Fair Housing and give the opportunity for all to live in your property.

If you get put on PROP you must also attend a city approved residential property management course which you will also probably have to pay for.

You must notify the tenants, condominium and townhome associations and all other effected entities (all of the neighbors?) that your house is on probation PROP. That gives the other people surrounding your house the ability to burn you good if your tenants piss them off.

If the city calls you and you are within 25 miles within the city you have exactly 2 days to respond to the code enforcers questioning about your property.

If you get cited even one time while on PROP you can lose your "rental permit" for 2 years and not be allowed to rent the place out.

If you get a 3rd violation while on the PROP program, they will take away your right to rent all other houses you have on the PROP program.

You are exempt from PROP if you are a bed and breakfast, hotel, motel, guest house, rest home, rooming house, lodging house or tourist homes.

I sure hope that you guys are good at kissing code enforcements you know whats because if not you will definitely be driven out of business. You better bring cookies to the surrounding neighbors houses on a weekly basis too. Very easy to get on this program. Your tenants can even get you on it.

Even playing loud music in Raleigh where you can hear it from 50 feet from the car will get the person a jail sentence of up to 30 days and a maximum fine of $500

PROP does not apply to the neighbors in the neighborhood associations. They can do as they wish. They can throw parties, they don't have to mow their yard, can get violated but their house won't get on Probation. They can get arrested, they can start fights with your tenants but the call to the police will only result in you getting fined, not the neighbor. It ONLY applies to landlords, not neighbors or tenants. Just you the landlord.

Interesting backwards logic right out of Raleigh's play book.
Q: Why aren't tenants held responsible?
A: Ultimately, the condition of the rental property and the activities of the tenants must be closely monitored by the property owner. Property owners are expected to write clear expectations of tenant behavior relative to neighbors into leases, and take action to encourage tenants to comply with these expectations or seek evictions for problem tenants. Rental property owners can also attend the City's Landlord Training Class given three times a year for more useful information about renting and protecting rental property.

The pieces of the puzzle have now been put together and are in place. We need to ban together and break it before it's too late. Fight for your rights or you will no longer have any! One attack after another on the "evil rich landlord" and we have to work together to stop it.

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