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Monday, March 16, 2009

When you make the payment, but the landlord doesn't

Much coverage has been given to the anxiety that is suffered when someone loses their home to direct foreclosure. But another anxious issue is arising: Felt by people who are not being foreclosed upon, but who live in an apartment complex owned by a corporation that is having financial trouble.

A recent story on MSNBC explored the chain-reaction—and frustration—imposed on people who rent from landlords that are having trouble. Below, you can watch video of one of the subjects in this story… a young renter who describes problems with upkeep, health hazards, and more (commercial pre-roll required).

Implications: My first thought on this topic is: How long will it take for lawyers specializing in renter/landlord litigation to become very high profile? (Similar to the way many personal injury attorneys now advertise.) There will be a tangled web of obligation to be sorted out; should I pay full rent if my landlord isn’t living up to his end of the deal? If ownership of a property transfers to a bank or trustee, does the responsibility of upkeep also transfer? And if a renter breaks their lease, who, exactly, should attempt to enforce any penalties?

The second--and more universal--thought that occurs to me is this: In an age where so many covenants are being broken, trust will command a premium. Consumers who make their payments will be cherished by companies. And companies who live up to their promises will be cherished by consumers.

Mike Anderson

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