Schenectady foreclosure glitch pinches tenants
SCHENECTADY James and Marcella Yetto hadn’t even unpacked when city officials knocked on the door.
Their new apartment was theirs no longer. The city had foreclosed on the building.
The couple had handed over rent and a security deposit to their landlord just one day earlier. Now they had nothing: their landlord, Krishna Narine, refused to give the security deposit back, although he did return their rent; city officials said they had to move out because the furnace didn’t work.
But without their security deposit, they couldn’t afford to get a new apartment.
“It’s been terrible,” said Marcella Yetto. “We were just unpacking. We had just moved everything in.”
First, they appealed to Narine. But he claimed to know nothing about the lengthy legal case against him, which had included repeated legal notices sent to his home address.
The Yettos ended up in a motel room, struggling to stay afloat, unable to save up the money for another security deposit.
“Not everyone has the money nowadays. We had just paid the deposit, and moved, and you think you’re going to be set for at least a year because that’s what the lease says,” Marcella Yetto said.
Then Assistant Corporation Counsel Carl Falotico stepped up.
He took the Yettos’ case for free, on his own time, and went to Small Claims Court to get their deposit back. He also took two other tenants’ cases, but was able to convince their former landlords to hand over the deposits without going to court.
He has now won the Yettos’ case, getting $587 back.
“It isn’t a life-changing amount, but if you need it for the security deposit on your new apartment ...” Falotico said. Two other cases, I talked to the landlord. This guy, he wanted to push it. So I did.”
He now wants to take other cases pro bono, if other tenants find themselves without their deposits after foreclosures.
“I want to get the message out there,” he said. “You can’t just walk away and take your tenant’s money. They’re due it back, by law.”
With the city planning more than 100 more foreclosures, he said he will support the displaced tenants in any way he can.
“We want to do everything we can to help,” he said.
Schenectady took 159 properties through foreclosure last year, and more than 200 other tax-delinquent properties are in the pipeline. Contractors are now bidding to rehab those properties and re-sell them through the city’s housing initiative, Key to the City.
In the meantime, city officials are arranging rental contracts with tenants after foreclosure, but only when the building is habitable. In some cases, serious problems with the roof or the furnace have forced them to close up the house.
Narine could not be reached for comment for this story. According to tax records, he owned 868 Stanley St., on which he owed $12,943 in back taxes. He also owned 844 Emmett St. with his brother Mahinie Narine, on which they owed $26,082 in back taxes. The city took both houses in foreclosure for failure to pay taxes.
The city’s new landlords association also attempted to find the landlords to find out their side of the story. Organizer Chris Morris said many small landlords get in over their heads, particularly if they have only a couple two-family homes on which they may still be paying a mortgage.
“Rent doesn’t take you very far,” she said. “Repairs, fees ... you pay this, you pay that, they don’t even realize the budget. I think it’s a sad situation.”
And many landlords don’t set aside their security deposits as they are supposed to, she said.
Narine was investing in the property — on foreclosure day, he had ripped up the living room carpet and was about to put down new carpet, Marcella Yetto said.
Falotico said Narine tried to argue in court that he had rightfully spent the security deposit on improvements to the property. However, the deposit can legally be used only to pay for damages or back rent.
The Yettos are now waiting for Narine to send them their money. Then they plan to immediately put it down on a new apartment — one that isn’t about to be foreclosed upon.
They’re hoping Narine pays up. They are all too aware that he could simply ignore the court judgment against him.
“If he doesn’t we have to take him to court again,” Marcella Yetto said.
But she’s confident that Falotico will help if it comes to that.
“I can’t say enough good about him. He didn’t have to pick our case up,” she said. “He didn’t have to stand up for us. And he did.”