Criminal Expungement Law Update

Minnesotans are facing one of the toughest housing markets and employment markets since we started tracking the statistics.  Criminal records prevent people from competing for jobs or obtaining safe, affordable housing and force them to rely on public assistance to survive. Expungement provides a second chance for those who have rehabilitated, allowing them to become productive members of our community. The June 2014 Tip of the Month highlights recent legislative changes to the expungement law, tips on how you can apply the new law to your client’s case to help give him or her a second chance. Read more >>

Submitted by: Chris Hanrahan, Resource Attorney, Volunteer Lawyers Network

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pdfdownload2 June Tip of the Month – New Criminal Expungement Law Update

Changes in Minnesota Foreclosure Law

Though foreclosures are on the decline, many low-income Minnesotans are still underwater on their mortgages and are seeking relief to stay in their homes.1 Banks and servicers have loss mitigation programs that provide an avenue for struggling homeowners to avoid foreclosure. Historically, many VLN clients have struggled to navigate the different avenues for relief, sometimes mailing and re-mailing modification applications so many times that their copies could fill a suitcase (one client actually did fill one). Unfortunately, often while the client was in the process of applying for relief, another branch of the lender was actively foreclosing the lien, resulting in the client losing his/her home without ever being considered for a modification that could have prevented the foreclosure.

The Minnesota legislature has enacted new provisions aimed at helping struggling borrowers remain in their homes. Provisions of Minn. Stat. § 582.043 took effect on August 1, 2013. This tip highlights important aspects of the new law that attorneys advising clients facing foreclosure should know.

Notice of Mitigation Options before Foreclosure

The new law requires a servicer to give the homeowner notice of loss mitigation options as a precondition to foreclosure. Before referring a mortgage to an attorney for foreclosure, a servicer must “notify a mortgagor in writing of available loss mitigation options offered by the servicer that are applicable to the mortgagor’s loan.”2 This provision applies to judicial foreclosures as well as foreclosures by advertisement on owner-occupied residential real property. For more information on the applicability of this provision, see Minn. Stat. § 582.043 Subd. 2.

There are free foreclosure counseling services available for borrowers who are struggling to make their mortgage payments or who have defaulted. Foreclosure counselors can review the homeowner’s financial situation and help work with the lender to avoid foreclosure. To locate a foreclosure counselor, visit: http://www.hocmn.org/foreclosure-prevention/find-a-foreclosure-counselor/.

Practice Tip: Scam artists frequently target struggling homeowners. A homeowner should never pay advance fees to get assistance with a modification or foreclosure counseling. Some scams even tell the homeowner not to work with the lender or tell them the lender is prohibited from working with them. When your client receives notice of mortgage assistance opportunities, contact the servicer of the loan or consult the Minnesota Attorney General’s website to investigate its validity.

Due Diligence Requirement and Elimination of Dual Tracking

New provisions of the law require the servicer to comply with their own loss mitigation procedures, an obligation that had been practically unenforceable. When a homeowner submits a request for one of the loss mitigation options, the servicer must “exercise reasonable diligence in obtaining documents and information from the mortgagor to completed a loss mitigation application…” and to “give the mortgagor a reasonable amount of time to provide the required documents.”3

Dual Tracking is the friendly label for the aforementioned process where a lender would proceed with foreclosure while at the same time processing a homeowner’s loss mitigation application. According to Minn. Stat. § 582.043 Subd. 6, if the servicer receives the application:

          • prior to referring the loan to an attorney for foreclosure;
      • after the loan has been referred to an attorney for foreclosure but before a foreclosure sale has been scheduled; or
      • after the foreclosure sale has been scheduled but before midnight on the seventh business day before the sale date;

the servicer cannot proceed with foreclosure until:

  1. the servicer determines that the homeowner is not eligible, notifies the homeowner in writing, and options for appeal have been exhausted;
  2. a written offer is made, but the homeowner has not accepted it within the required time frame; or
  3. the homeowner declines the loss mitigation offer in writing.

Private Cause of Action Created

During the foreclosure crisis, VLN clients reported enduring nearly every imaginable problem or delay a servicer could occasion upon the loss mitigation application process, and many were foreclosed upon while their application was ‘out there.’ Now, homeowners have a cause of action to enjoin or set aside a sale if the servicer does not comply with loss mitigation requirements. The statute also allows for attorney fees and costs in prevailing actions. The homeowner must bring the action and record a lis pendens prior to the expiration of the redemption period. Loss mitigation options already existed, but the new statutes give attorneys a tool to ensure that their clients have access to every available option when fighting to save their homes.

Practice Tip: If you are representing a client on a pro bono case, sign up for an account at www.ProJusticeMN.org to access trainings and resources to help with your case and to join the Foreclosure Defense Taskforce, a listserv that facilitates communication and collaboration among foreclosure defense attorneys.

Full Text

For the full text of the new law and exact effective dates, see Chapter 115 in the Minnesota Session Laws for the 2013 regular session, S.F.No. 1276, available at: https://www.revisor.mn.gov/laws/?id=115&doctype=Chapter&year=2013&type=0.


1 For statistical data, see the 2013 Semi-Annual Foreclosures in Minnesota report released on August 9, 2013 by the Minnesota Homeownership Center available at: http://www.hocmn.org/wp- content/uploads/2013/08/SemiAnnual_ForeclosuresInMN_Report_2013.pdf.
2 Minn. Stat. § 582.043, Subd. 5 (1)
3 Minn. Stat. § 582.043 Subd. 5 (2)

Submitted by: Chris Hanrahan, VLN Resource Attorney

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pdfdownload2 September Tip of the Month – Changes in Minnesota Foreclosure Law

Helping Victims of Domestic Violence Escape Dangerous Rental Housing

Submitted by Chris Hanrahan, VLN Resource Attorney, with the help of Dorinda Wider, Legal Aid Society of Minneapolis Attorney, and Christy Snow-Kaster, Central Minnesota Legal Services Attorney 

It is a difficult choice for a victim of domestic violence to leave an abuser, and when living in rental housing, obligations under the lease can make the decision even more difficult.  The impact of domestic violence extends well beyond physical and emotional harm to the victim.  The Federal Violence Against Women Act (VAWA) and state statutes facilitate the victim’s escape from a violent home.

PROBLEMS FACED BY VICTIMS OF ABUSE

Moving takes the victim out of the dangerous environment, but may result in a struggle to maintain basic human needs.  Moving out of rented housing often involves the victim breaking a lease.  Traditionally, even if the victim vacates the property, there remains a contractual obligation to pay rent.  Failure to pay rent may result in the landlord filing an eviction or other action to recover the unpaid rent.  Joint liability under the lease may mean that the victim will have to face the abuser in court.

Aside from rent obligations, domestic violence can affect the victim’s compliance with other terms in the lease.  Victims who stay with an abuser run the risk of being evicted for the criminal activity and repeated police calls that can be associated with domestic abuse.  Violent struggles in the home can also result in damage to the premises for which the landlord may hold the victim liable.  The victim’s problems can even extend beyond the current tenancy.  If the landlord files an eviction or other action against the victim, the resulting court record may make it difficult for the victim to find safe, affordable housing.

ISSUE SPOTTING

As discussed below, victims of domestic abuse are afforded protections under state and federal laws. However, victims do not always identify themselves as victims. It is important for the housing attorney to spot signs of domestic abuse in order to invoke these protections.

Practice Tip:  Ask questions and fully investigate the grounds of a landlord’s case to determine whether domestic violence is an underlying factor, manifesting as a complaint against the tenant of

  • noise
  • criminal activity
  • police visits
  • property damage
  • unauthorized occupants, or
  • nonpayment of rent.

SOLUTIONS

At both the state and federal level, there is some relief available to help victims of domestic violence escape dangerous rental housing.  VAWA, as amended, applies only to housing involving federal funding, including public housing, the housing choice voucher program, and project-based Section 8, among others.  People living in private housing must rely on state laws or negotiate with their landlords.

VAWA

VAWA’s scope aims to ensure that victims of domestic violence and their families can maintain housing.  VAWA protects victims of domestic violence, dating violence, or stalking, who live in federally funded housing or who are applying for federally-funded housing.  The act’s protections extend to immediate family members of the victims as well.

Landlords cannot evict a victim for incidents of actual or threatened domestic violence, dating violence, or stalking unless the landlord can show that allowing the victim to remain would pose an actual and imminent threat to the safety of others.  Also, the landlord cannot evict the victim for criminal activity directly related to such violence.  The landlord can still evict the victim for unrelated criminal activity or lease violations, but cannot hold the victim to a higher standard than others because of the domestic violence.  The victim can raise VAWA’s protections as a defense to an eviction action, but, to avoid the court case altogether, it may be prudent to invoke the protections as soon as the victim has notice of the landlord’s intent to file an eviction action.  The victim can write an explanation to the landlord that addresses the landlord’s grounds for eviction and ties them to the domestic abuse.

Practice Tip:  When your client is a victim or an immediate family member of a victim, search for connections between the domestic violence and the grounds for eviction.  For example, the client may have been arrested and charged with an assault, but upon further investigation, she had been acting in self-defense against the abuser.  Establishing this connection could save the client from eviction.

VAWA gives the victim some options with regard to modifying or terminating the lease.

  1. Bifurcating the Lease: One option is for the landlord to bifurcate the lease and evict the abuser, keeping the victim in the premises.  The victim and remaining family members can attempt to renegotiate the terms of their lease with the landlord in order to stay in the home.  The victim will have to provide proof of the violence to the landlord.  This can be as simple as offering the victim’s certification of the situation, but can also include providing copies of police or court records, restraining orders, or other proof.  The landlord is required to keep such information confidential. Since the abuser is losing a federal interest, due process requirements will apply.
  2. Terminating the Lease: In a tenancy under the Section 8 voucher program, the victim may be able to terminate the lease, retain the voucher, and transfer to a different location.  Section 8 rules limit the ability for tenants to move, with rules against mid-lease moving and limiting the portability of a voucher.  VAWA provides an avenue around these rules, allowing the victim to leave and find safer housing in a location unknown to the abuser.

Practice Tip:  While VAWA offers protections for victims of domestic violence, it also offers legal methods for landlords to evict abusers.  Keep this in mind when advising landlords.

APPLYING FOR FEDERALLY FUNDED HOUSING

In addition to protecting victims living in federally funded housing, VAWA protects victims who are applying for federally funded housing.  A federally funded landlord cannot reject an applicant because he or she is a victim of domestic violence, dating violence, or stalking.  To assert this protection, the victim must know the grounds for denial and be able to connect them to the status as a victim.  The victim can provide written notice to the prospective landlord that the denial is because of the incidents of domestic violence.  Again, any proof or explanation about the violence is confidential, and the landlord cannot release the information without the victim’s consent.

Practice Tip:  The connection between the domestic violence and the reason for denial of the application may not be apparent.  Prior evictions, criminal activity, or landlord claims of unpaid rent could be grounds for denial, but they may be the result of prior instances of domestic violence.  Search for a connection and assert it to the landlord.

STATE LAW

Minnesota allows a victim of domestic abuse to terminate the lease and leave the premises, subject to some important qualifications.  Minn. Stat. § 518B.01 Subdiv. 2 (a) defines domestic abuse as when a household member does the following against a family member or household member:

  • causes physical harm, bodily injury or assault;
  • inflicts fear of imminent physical harm, bodily injury, or assault; or
  • commits terroristic threats, criminal sexual conduct, or interference with an emergency call (offenses defined by specific statutes).

This solution under state law is available to victims in all forms of rental housing.  It has strict requirements so, unless the victim has complied, it is not a viable defense to an eviction action or a landlord’s claim of rent.

Under Minn. Stat. § 504B.206, a tenant who is a victim of domestic abuse who fears imminent domestic abuse to the tenant or to the tenant’s minor children may terminate a lease after providing advance written notice to the landlord.

The written notice must state that:

  • the tenant fears imminent domestic abuse from a person named in an order for protection or no contact order;
  • the tenant needs to terminate the tenancy; and
  • the specific date the tenancy will terminate.

The victim must deliver the notice by mail, fax, or in person prior to the termination date, along with a copy of the order for protection or no contact order.  Note that under state law the victim must have an order for protection or no contact order; without one, this statute will not excuse obligations under the lease.  The disclosure is confidential, but the landlord may be able to use it in an eviction action or a claim for unpaid rent or damages.  In addition to providing notice, the victim must pay the full rent for the month encompassing the termination date and one additional month’s rent prior to the termination date.  When fully compliant with the statute, the victim is relieved of obligations under the lease.  Any remaining tenants are still liable under the lease.

Practice Tip:  While exact compliance is required to claim statutory protection, you may be able to negotiate with the landlord, using similar terms that are more attainable for the client.  Be sure to address co-tenant liability, if applicable.

RESOURCES

  • Law Help MN  Factsheets H-22 “Subsidized Housing Rights for Victims of Domestic Violence” and H-23 “Victims of Domestic Violence:  Your Rights in Breaking Your Lease”.
  • ProJusticeMN – CLE materials for “Using VAWA to Get and Keep Subsidized Housing CLE” presented by Christy Snow-Kaster from Central Minnesota Legal Services and Dorinda Wider from Legal Aid Society of Minneapolis.
  • Legal Momentum  – “Housing Rights for Survivors of Domestic Violence Living in Public Housing or Using Vouchers”.