Renting beats owning a home in California and many other markets

rent 2Even though owning a home is still cheaper than renting nationally there are many markets where it is still cheaper to rent than own.  One of those markets is all of California!  This is rentaccording to a Deutsch Bank housing survey cited in an article posted on-line in SmartMoney.  With housing price declines and record low-interest rates it should be cheaper to own real estate but in California and the northeast and elsewhere it is still in fact cheaper to be a tenant.

According to the same article homeownership is slipping.  It is down from a high of 69% in 2004 to a low of 65% and it appears to be still falling.  More and more people seem to have caught wind of this fact and they are becoming tenants.  Apparently one-third of all rentals are single family homes as the number of single family homes for rent grew by 2 million from 2006 to 2010.  There are currently a total of 13 cities where it is cheaper to rent than own now.

So don’t despair if you don’t have a piece of the American dream.  Don’t worry if you have been foreclosed on and you now must rent.  If it is cheaper to rent then maybe renting is a good idea for a while.  It is doubtful that their will be any meaningful appreciation in housing anytime soon so why buy?  When you add in the costs of maintenance, insurance, mortgage, and taxes it is very expensive owning a home.  Let the landlord worry about that stuff and be happy renting!

Now may also be a good time to clean up those debts yo have accumulated over the years too.  Paying rent is always easier without paying for all those credit cards, personal loans, auto deficiency balances, and medical bills.  Try bankruptcy to eliminate those old debts and get a fresh start.

I am a San Diego bankruptcy attorney.  For further questions please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com.  Or call my office for a free consultation or for any other advice about bankruptcy or debt at (619) 702-5015. Call now for free credit report and analysis!

For a free e-book on “13 things to do to prepare for your bankruptcy filing” please e-mail me at farquharesq@yahoo.com.

 

For rent photo courtesy of Billy Alexander.  Houses for rent photo courtesy of cdsessoms.

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How to kick out a squatter from your home or condo in California. If police won’t remove them then you must evict.

I have written several blogs about the squatter phenomenon in America and around the world today.  There is a whole squatter movement that preaches that squatters have the right to occupy vacant homes.  As I wrote in a previous blog………..many groups are pushing the “housing as a human right” philosophy and encouraging people to take over homes that are unoccupied.  They seem to feel entitled to these homes because they believe the banks were responsible for the financial meltdown.  Whatever the justification the squatter movement is leading to a situation where vacant homes are being occupied.

It is common now that a bank will foreclose on and take back a home only to have it remain empty for a period.  During this period the squatter moves in.  A hapless individual buyer may then purchase the home in the foreclosure sale or from a middle man.  The homeowner would then be presented with the squatter problem.  He may not have been told by the bank and the bank may not have known themselves about the squatter’s existence.  Some squatters don’t make their occupation obvious.

Now the problem is that of the current owner.  These squatters can be angry, violent and have been known to attack owners or property managers inspecting property.  The people inspecting may have no idea that the squatter was there.  I reported on this in a previous blog: http://bit.ly/Iyo3g4 .

The squatters rights movement is made all the more possible and widespread by the foreclosure crisis in America which left this large number of homes vacant.  The reality is that someone does own these homes.  They are either owned by the bank or by some business or individual.  Eventually someone, either as owner or renter, will legally attempt to occupy it.  If there is a squatter in there then this could be a problem.  At that point it does not matter if the squatter is just a lone criminal or someone spurred on by a political movement.  He is now the homeowner’s problem.

Many squatters present phony, fraudulent rental agreements to anyone attempting to challenge their occupation of the premises.  This present a problem because there is an appearance of legitimacy created by the phony document.  This is enough to ward off the police who view this as a legal dispute which needs to be heard in court.  In California the police will therefore probably refuse to get involved when called and tell you to get an attorney and evict the squatter.

This is what I recommend too.  A client of mine just told me he has a squatter in his condo and I told him the same thing.  He needs to evict the squatter immediately.  The squatter should be given a 3 day notice to pay rent or quit (or a 3 day notice to vacate the premises because there is not rental agreement or agreed upon rent amount).  The notice must be delivered properly and done in the proper format in case the squatter gets a tenants rights lawyer.  In California tenants have many rights and as landlord you must be sure to do everything correctly.

Once the 3 day notice is created, signed and delivered personally or by what is called “post and mail” then the 3 days must elapse before you file and eviction.  Post and mail means you post a copy and mail a copy to the resident/squatter.  You may not know the squatter’s name so that creates another problem too.  Now you file the eviction and serve it with a process-server on the squatter.

The next step is defaulting the squatter if he does not answer but if he does then you have to set the case for trial.  If he does not show at trial then you get a default judgement and if he does then you must show that you own the property or you are an agent of the owner.  If you own the subject property then you can go in at that point and say to the judge that this is a squatter with no legal rights/lease/rental agreement.  Let the squatter show his phony lease to the judge.  It is unlikely to hold up in court.  If it does then you can object and at least demand rent be paid.  Be sure to be ready to testify to how long you believe the squatter has occupied the premises so you can demand rent for that whole period.

Chances are the whole thing will break down before this point and you will win.  I do recommend a good tenant’s attorney though because these are complicated procedures that need to be done correctly.  Remember that “self-help” is not allowed in California and this is the proper legal process if the police will not remove the squatter in the first place.

I am a San Diego bankruptcy attorney.  Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com for more info. about any of these topics.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

Landlord notification and bankruptcy

Your landlord will not be notified if you file bankruptcy in most cases.  That is because most people have month to month tenancies.  In these cases there is nothing to report.  There is no asset in the bankruptcy estate that is created or affected by a month to month tenancy.  Your landlord is not notified and you keep on renting and residing in your unit right through and after the bankruptcy.

If you have a lease then the lease is technically an asset of the bankruptcy estate that the trustee could sell to another party.  The reality is that residential leases rarely have any value to anyone so the trustee will not take any action when the lease is reported.  In those cases the landlords are notified of the bankruptcy and the lease is broken at the point of filing the bankruptcy.

Now as a tenant you can decide if you want to sign a new lease or continue living in the premises as a month to month tenant. The landlord though cannot evict you for filing bankruptcy as this would be bankruptcy discrimination and that is not allowed. If you are a good tenant and pay your rent and don’t make noise then in the vast majority of cases the landlords will not care if you stay on and continue renting.

Before I was a bankruptcy attorney I handled evictions for landlords.  Good quiet tenants who pay their rent and don’t disrupt other tenants simply don’t get evicted.  Landlords want these tenants to remain because they are sometimes hard to come by.  So pay your rent and don’t disturb the “quiet enjoyment” of the other tenants in the building and you will not get evicted for anything.

Remember that a landlord will not even know you filed if you have a month to mont.  With a lease he will need to be notified but then you are protected because he can’t discriminate against you for exercising your federal right to file for bankruptcy.  The remember too that if you are a good tenant it is unlikely that the landlord id even looking to evict you.

So don’t despair.  You can file bankruptcy and be safe in your home, condo, or apartment.

I am a San Diego bankruptcy attorney.  Please visit my website for further information at www.farquharlaw.com or www.freshstartsandiego.com.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

Good news for tenants! You can wipe out most debt related to your tenancy in bankruptcy!

Tenants often get saddled with debts they cannot pay after renting a house, condo, or apartment.  There are debts for back rent, unpaid utilities, damages to the premises, or unpaid security deposits.  All of these types of debts are dischargeable in a bankruptcy usually with no problem.  A landlord would have to prove fraud or willful and malicious damage to his premises to get these debts to be not dischargeable in bankruptcy.

In some cases there can even be a huge debt left over if you vacate the premises early in a lease.  If you sign a lease for a year and vacate after six months the landlord can sue you for the other six months of the lease.  This can be substantial.  Many of my clients have signed a 10 year lease for a commercial space and then quickly vacated when their businesses failed.  The  landlords then sued and got judgements in excess of $300,000.  These clients quickly filed for bankruptcy and discharged this debt without any trouble and we didn’t ever see the landlords show up at the 341 hearing.

Landlords often threaten you with paying for these debts but just mention the word bankruptcy.  There is nothing they can do once you file bankruptcy if there is no fraud or willful and malicious damage.  So don’t worry when they threaten you with lawsuits.  One of my commercial clients was called to a debtor’s exam about his huge debt for his broken lease.  He showed up with his bankruptcy papers in hand.  The lawyer stuttered and stammered and when she went to the judge he laughed and said she would have to seek redress in bankruptcy court.  We got his discharge and never heard from them again.

Landlords are supposed to make every attempt to re-rent the premises you vacate when you break your lease.  We usually don’t know if they even bother to do this though.  It’s called mitigation of damages.  If the landlord tries but can’t re-rent your vacated premises then you are still liable for the unpaid rent if you don’t file bankruptcy.

Even a debt of $300,000 goes away easily in bankruptcy so don’t worry.  If you are a residential tenant who has a much smaller debt from a few months of back rent then that can be put in the bankruptcy too along with your credit card debts, medical debts, and any other dischargeable debts you may have.

Don’t let a landlord bully of threaten you with a big bill because bankruptcy will wipe it out.  Don’t let them threaten you with a lawsuit either.  A bankruptcy will also stop an eviction and force the landlord to seek a motion for relief from stay before he can remove you from the premises.  If you need more time to vacate the premises then bankruptcy give you extra time to move.

I believe that bankruptcy’s main value is in wiping out those old debts so call a bankruptcy attorney today if you have debts related to a tenancy.

I am a San Diego bankruptcy attorney.  For further information please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

Will my landlord be notified of my bankruptcy and can he evict me if I file?

(See my blog with an update to landlord notification and bankruptcy here: http://bit.ly/IAaaQc .)

No!  Your landlord will probably not even know that you filed and if he did you are protected by law.  A landlord cannot legally evict a tenant for filing bankruptcy.  If you file bankruptcy and then try to move in a landlord can keep you out only if he has a policy that every prospective tenant has to follow where he will not rent to bankruptcy filers.  But if you are already in your rental unit and you then file bankruptcy then you are protected by law and the landlord cannot evict you for filing.

Probably though he will never even find out that you filed for bankruptcy.  It is only if you have a unexpired lease for any amount of time that he would be notified of your filing.  If you are month to month then your landlord won’t be notified.  But if the landlord somehow finds out about your bankruptcy or he is notified directly because of an ongoing lease he still cannot evict you.   If your landlord tries to evict you after a bankruptcy and because of the bankruptcy then you can fight the eviction in California.  I believe other states have similar defenses to unlawful evictions.

Remember that you have a federal legal right to file for bankruptcy.  No landlord can challenge that or take it away or discriminate against you for exercising your legal federal right to get a fresh start with our debts!  If the landlord is smart he will see that you can now pay rent more easily as you will have discharged your credit card, medical, deficiency balance, and other debts in the bankruptcy which will free up more income to pay for rent and your other necessities.  You may get a landlord that does not care or even is happy that you filed.

But either way don’t be intimidated by a landlord who threatens an eviction.  You can fight the eviction and win if the reason he is evicting you is because you filed for bankruptcy.

I am a San Diego bankruptcy attorney.  For more information please visit my website at www.farquharlaw.com or www.freshstartsandiego.com.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!  If you are considering bankruptcy then get my Free e-book; “13 Things You Should D to Prepare For Filing Bankruptcy” by e-mailing me at farquharesq@yahoo.com.

Cash for keys! It’s still available after a foreclosure. My advice is get that cash!

(For the current state of the foreclosure crisis see this blog: http://bit.ly/JGU1dZ ).

How many times does someone hand you cash?  I’m sure it’s not often but it is the case that lenders are offering cash for keys after a foreclosure.  You may or may not be upset about the foreclosure and you may actually be relieved that the process is all over.  You may have tried a short sale that failed (or you may have never attempted one) and now the foreclosure sale has taken place and you are being contacted by the new owner of your property to find out from you what your plans are.

Remember that this new owner will have to evict you legally before he can get you out of this house that you formerly owned even though he is the new legal owner of the property.  He cannot throw you into the street.  There is no “self-help” allowed and the only way a new owner can get you out of your former home is through the eviction process.  You are no squatter.  You originally entered the property legally.   You are the former owner with the legal right to be there until a judge evicts you in court.

In California eviction means that the landlord has to give you a 3 day notice, followed by a filing of an unlawful detainer action, followed by a trial, followed by a sheriff who will actually remove you.  This all takes time and money.  To get you out will take around 4 to 6 weeks depending on how behind the courts and the sheriffs are.  In addition he has to hire attorneys, pay filing fees, and wait until the process finishes.

Or he can pay you money.  The going rate is about $3000 so don’t sell cheap.  Many of my clients have been offered and have received this money.  It will cost the landlord almost that much to proceed with and eviction plus there is the time involved.  The landlord may ask you to leave quickly (like in a week) but you can always try to negotiate for more time.  Just don’t scare him off so he doesn’t pay you.  Remember though that he will know the costs of legally removing you and that is your leverage.

You have a legal right to be in this home until he goes through the lengthy and costly legal process of removing you.  You can remind him of that if it helps the negotiations but always remember that you have legal rights.  If you don’t exercise them you will lose them.  You will be saving him time and money if you get out quickly with no hassles for $3000.

An extra $3000 can help a lot with bills and getting a new place.  If you can get more time then do so but if not then I suggest you take the money.

If you need a bankruptcy now to get rid of credit card or automobile deficiency or medical debt then call me and we will discuss how to free you up from the rest of your debt.

I am a San Diego bankruptcy attorney.  Please visit my website for more information at www.farquharlaw.com or www.freshstartsandiego.com.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!  If you or someone you know may need to file a bankruptcy get my FREE E-BOOK: “13 THINGS YOU SHOULD DO TO PREPARE FOR OUR BANKRUPTCY FILING” by e-mailing me at: farquharesq@yahoo.com.

Will my landlord be notified when I file for bankruptcy?

(For an updated blog on landlord notification and bankruptcy see here: http://bit.ly/IAaaQc ).

No!  If you are  on a month to month rental agreement then the landlord does not have to know that you filed.  The landlord will not be notified if you file bankruptcy and your landlord will probably never know that you filed.  Your filing is a public record but it is unlikely that your landlord will read a list of bankruptcy filings in a legal newspaper.

Also your landlord will probably have no reason to check your credit report once you move into your home or apartment.  The filing will appear on you credit report but it is unlikely that your landlord will view it once you have moved in.

If you have a lease with the landlord then that will have to be listed in the bankruptcy.  The landlord cannot evict you for filing bankruptcy and in most cases your lease obligation in the bankruptcy will be wiped out and your tenancy will be converted to a month to month tenancy.  A landlord may ask for a new lease but you don’t have to sign one.

The reality is that if you are a good tenant and pay rent on time then the landlord will do nothing even if you have a lease.   You will be able to stay and keep paying rent on a month to month basis after the bankruptcy.

Your landlord cannot evict you or otherwise discriminate against you if they become aware of your filing.  This kind of discrimination because of bankruptcy is illegal.  They cannot anymore evict you because of a bankruptcy filing than they can fire you from your job because you filed.

So file for bankruptcy and rest assured that your living situation is safe and that on a month to month rental agreement the landlord will probably never even know you filed bankruptcy.

I am a bankruptcy attorney practicing in San Diego.  For more help please visit my website at www.farquharlaw.com or www.freshstartsandiego.com.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

When squatters attack! Once they occupy your house you have to evict them (but you pay for them in the mean time).

(Check out my update on squatters here- http://bit.ly/Iyo3g4 ).

(For how to get squatters out of your property see here: http://bit.ly/JMX8kG ).

I am fascinated, perplexed and appalled by this ongoing problem of squatters.  It seems to point to bad things coming to this country (like a depression).

I thought I would blog about a squatters report that I saw on the news.  I wrote about this topic previously and the problem of squatters occupying foreclosed homes is certainly not going away.  In fact in some ways things may be getting worse out there with squatters.

Buyers of foreclosed homes are finding themselves paying insurance, taxes, and payments while the squatters occupy their house.  As I previously reported the squatters are probably not the previous owners of the home.  Those people have probably already gone.  The squatters are often people who move in after the foreclosure.  They find the vacant house, move in, occupy, and dare you to kick them out.

According to Fox News a family in Connecticut had squatters in their home after the family purchased the home in a foreclosure sale.  They went to move in and they found the squatters on the premises.  At that point they realized that they had become landlords and the squatters were their tenants except that these tenants paid no rent.  All they did was occupy and refuse to get out.

Before I did bankruptcy law I was doing landlord/tenant cases.  In California self-help is not allowed. You cannot kick squatters out without a court order and they become your tenants once they occupy the house.  They may even produce a phony rental agreement or they may say they had a verbal agreement with the previous owner.  Either way they stay until you evict them legally.

The police don’t want to get in the middle of what they consider to be a dispute between you and them.  If your lucky the squatters will take cash to leave and if you are not then you must got through the eviction system.  To evict them legally you need to serve a 3 day notice on them and then file an unlawful detainer action and then wait for a court date.  You need to win in court and then file a writ of possession and get a sheriff to kick them out.  All of this takes time.

In the Fox story the buyers could not move into their house after they bought it.  The bank had promised that they would evict these squatters yet they had not.  The family who bought the home had to wait for the sheriff to remove them.  When they interviewed the sheriff he told of how in the early morning the squatter was drunk, had a vicious dog that had to corralled, and he had a gun.

The sheriff did get them out but the evicted squatters left a horrible mess in the house.  The mom who bought the house said that she did not even want to move in at that point.

Be careful if you buy a foreclosed home.  Go to the home regularly before you close the deal to see who is occupying the house.  If you see signs of squatters make sure they are moved out before you close on the home and you become the owner. If you do not then you could become a landlord to some squatter who you would have to evict yourself.  This could take months and in the mean time you could be stuck paying taxes, insurance, and the house payment while the squatters live for free in your house.

These people know how to manipulate the system so don’t become the victim of this latest scam.

I am a San Diego bankruptcy attorney.  For more help please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.