Bill Requires Rental Property Owners to Do The Right Thing In the wake of California’s foreclosure crises, unscrupulous property owners who have rental homes that are being foreclosed upon are continuing to accept new tenants, taking large security deposits, and not informing the tenants that the property is being foreclosed upon and the tenant may be forced to move shortly thereafter. In these situations, the tenants have a hard time getting their security deposits back, if at all, and are forced to find a new place to live after the bank takes over. The legitimate rental housing industry has been hard hit in the press as a a result of these unethical owners. As a result, Senator Joe Simitian (D-Palo Alto) introduced SB 1191 to require a property owner who owns one to four units and who has received a recorded Notice of Default for failure to pay the mortgage to inform any new prospective tenant that a Notice of Default has been filed against the property. Ninety-nine percent of all foreclosures are taking place on single family homes and buildings with 2 to 4 units. These default notices are typically filed 5 to 6 months after the property owner has failed to pay the mortgage. The bill doesn’t prohibit the owner from proceeding to sign a rental agreement with the tenant; It simply requires the owner to ensure that the tenant has full disclosure about the current situation. CAA has taken a support position on the bill. The bill has made it through the legislative hearing process and is current on the Assembly Floor for a vote.