Two days before the deadline to move out, Latisha Silva, above, lands in the hospital with a staph infection last month. After she recovered, she and her family found a new rental in Providence.

By Lynn Arditi | Photos by John Freidah
Providence Journal staff

Latisha Silva never bought a house or signed a risky mortgage. But her landlord did.

So when the bank foreclosed on the house she rented in Pawtucket, Silva and her family were ordered to move out by Oct. 31 or face eviction.

Two days before the deadline, Latisha landed in the hospital with a staph infection.

Lying in a hospital bed, medication dripping into her arm from an IV, she wondered which was worse: losing her health or losing her home.

“I had an anxiety attack this morning,” she said, wearily. “I never had nothing like that before.”

Foreclosures are claiming some unlikely casualties: renters.

In cities and suburbs around Rhode Island, people who paid their rent and even signed leases are now being told to pack up and leave their homes because landlords have fallen behind on the mortgage.

The Mortgage Bankers Association reported earlier this year that, on average, nearly one in seven foreclosures nationwide are for properties where the owner does not live on the premises.

Nobody knows how many renters around Rhode Island are being forced out of their homes due to foreclosures, but lawyers, judges and real estate agents for lenders say the numbers are way up.

More than 800 properties in Rhode Island were repossessed by banks through foreclosure as of June, an increase of 380 percent from a year earlier, according to an analysis by LoanPerformance, a division of First American CoreLogic Inc., in San Francisco

The Rhode Island Legal Services office in Providence has been “inundated” with cases of tenants who are being evicted by banks involved in repossessing foreclosed houses, said Robert M. Sabel, the agency’s litigation director.

“Before, it was an occasional case — once every four or five months,” Sabel said. “Now we’re seeing them daily.”

Some lenders try to avoid the trouble and expense of evicting tenants by offering them money — “cash for keys” — to sign an agreement to get out by a certain date. Real estate agents hired by the lender also may try to finagle the tenants more time.

But life can get uncomfortable. A landlord who stops paying the mortgage may fall behind on other bills. Then the faucets run dry and furnaces go cold.

ALERTED BY her downstairs neighbor, Irene Foss looked out her second-floor window onto Daboll Street in Providence one morning last month and saw a city water truck parked outside.

“They shut the water off!”

Foss shares the triple-decker with six other adults and seven children. She had heard that the building was going up for auction; a neighbor spotted a foreclosure ad in The Providence Journal. Maybe the new owner would want to keep the tenants, she thought.

Foss is 79 and in poor health. But she can use a phone book.

“So, I called the mayor’s office,” she said.

From her television chair, Foss explained the situation to the mayor’s director of senior services who, in turn, called the Narragansett Bay Commission. The landlord had not paid the sewage bill. By law, the commission is authorized to shut off the water for nonpayment.

The water was turned back on the next day but the tenants were told to pay $988.40 in cash for the fees that were 90 days’ past due.

“We turned them back on even before they paid because we found out that there are elderly in the house,” the commission’s spokeswoman, Jamie Sammons, said later.

To make that payment, Foss, a widow who lives on a $840-a-month pension, took $250 she’d saved for the rent. Several neighbors contributed and one hand-delivered an envelope with almost the full amount in cash to the commission offices. Each tenant got a receipt — on of the Narragansett Bay Commission letterhead — dated Nov. 5. Sammons said the tenants who helped pay the sewer bill can “withhold that money from the rent.”

Only now, there are no rent payments. On Tuesday, Foss stood on her porch and watched a man with a clipboard auction off her building. Only one bidder showed up. The bank turned down his $50,000 offer. The amount owed on the property is $214,450.29.

“Sorry I couldn’t be more charitable,” the auctioneer said to the lone bidder.

Foss has lived in three different houses on Daboll Street for the past 42 years. She told the auctioneer that the landlord had come by just last week to show someone an apartment.

If he comes back trying to collect more rent, the auctioneer told Foss, don’t give him any money. “Stand strong,” he said.

She’ll have to wait to hear from the bank about when she has to move out.

THERE IS NO law requiring notification to tenants when a house is in foreclosure. Sometimes they are caught unaware.” The first thing they know is there’s some people standing out in the front yard auctioning off the property,” said Sabel, the legal services director. “And the next day they’ve got a five-day notice to vacate.”

In foreclosure cases, renters lack the legal protections that normally govern tenant-landlord relationships. For example, when someone buys an occupied rental property, state law requires the new owner to honor any existing leases.

But banks are not landlords, nor do they want to become landlords. Their only obligation to the tenants is spelled out in a single sentence in Rhode Island’s commercial property statute, Chapter 34-18.1. The law states that the occupants of foreclosed properties are tenants “at will or by sufferance,” and that they should be given “reasonable notice” before being ordered to move out.

The term “reasonable,” lawyers say, has been interpreted by the state courts to mean as little as three days, but the standard is generally 30 to 40 days.

Tenants may not be notified until after the auction, when the foreclosure deed transferring ownership is recorded at a city or town hall.

Tenants first get a notice setting a deadline to move out. If they don’t, the new owner — the bank, in most cases — can file a 20-day summons in court to begin the eviction process.

If the tenant fails to respond within the 20 days, a judge generally enters a “default judgment” in favor of the property owner. The owner may hire a sheriff or licensed constable to serve the tenant with an eviction notice. If the tenant still does not move out, the owner can hire a moving company and remove furniture, clothes and other belongings and place them in storage — at the tenants’ expense.

Katherine Chace Ormond paid two months’ rent after the bank foreclosed on the duplex where she lived on Maple Avenue in Cranston. The Cranston Housing Authority also paid its share of her Section 8 rent.

Ormond moved to Cranston from Tiverton with her 10-year-old son, Jack, last February. Her lease ran through next Feb. 1. Single and disabled, she paid $326 a month and the Housing Authority paid $624.

Ormond received her 20-day summons and appeared for an eviction hearing in Kent County Court on Oct. 23. City housing officials later learned that they were paying rent for a house that had been repossessed.

“You think through common courtesy, the landlord would notify us,” the authority’s Section 8 coordinator, Marie Fisher, said.

At her eviction hearing in court, Ormond said, a judge told her she had five days to move out. A lawyer at Rhode Island Legal Services negotiated an agreement with the bank to give her until Nov. 15.

A few days before the move, Ormond said, she asked her landlord on the phone for her $900 security deposit. “He told me to sell the gas stove and the fridge for the deposit,” she said. She put them on Craig’s List and got $125.

While she packed, she kept the kitchen windows open and a plastic garbage bag around the open gas pipe jutting from the wall — just in case the gas leaked.

THE AFTERNOON Latisha Silva was released from the hospital — two days after her deadline to move out — she went straight to the Providence Housing Authority to sign a Section 8 lease on a new rental house. It was a Friday, and she wanted to get there before the office closed.

But she was no longer facing immediate eviction; the real estate agent for the bank had agreed to give the family another month, if needed. Eager to pack up, move and get back to a new job, she spent the weekend packing. On Monday, Silva walked out to a rented U-Haul parked in the driveway. She clipped her work I.D. badge onto her blouse, so she wouldn’t lose it. She was hoping to go back to work — answering calls at AAA from distressed motorists — the next day.

In the backyard, garbage cans overflowed and leaves soaked in the rainwater that had collected in their canvas swimming pool.

Silva’s left arm was still bandaged in gauze and tender from surgery. She used her good arm to push a plastic Cinderella bed and a toy car out of the driveway.

It was getting near rush hour. Her fiancÉ, Joseph, had been up until after 1 a.m. at their new rental house in Providence. He had already repainted most of the downstairs and glued new linoleum in the kitchen. Her mother was watching their three children. It was left to Latisha to haul the first load.

Latisha used to drive an ambulance; she could handle this.

She climbed into the cab of the U-Haul, set the gear in reverse, and slowly backed out the driveway.

larditi@projo.com