This week's Monday Roundup comes a day late due to the Memorial Day holiday.
New Federal Legislation Affecting Tenants' Rights Following Landlord Foreclosure
On May 20, President Obama signed into law the Protecting Tenants at Foreclosure Act of 2009 (the "Act"), Title VII of a larger piece of legislation called the "Helping Families Save Their Homes Act of 2009." The Act provides new rights for tenants of foreclosed-upon residential property, which presumably includes single-family homes, multifamily properties, and residential condominiums. The buyer in such a foreclosure must provide at least ninety days' prior notice if the tenant is to be required to vacate the property. Furthermore, a tenant under a "bona fide lease" has the right, with a limited exception, to occupy its leased premises until the end of the then remaining lease term. The Act defines a "bona fide lease" as one that resulted from an arm's-length transaction in which the tenant is not the mortgagor or its child, spouse, or parent, and the rent is "not substantially less than fair market rent." The official version of the Act as signed by the President has not yet been released, but the full text of the enrolled bill (as approved by Congress and sent to the President for signature) is available by clicking here.
LandAm Subsidiary Sale Approved by Bankruptcy Court
The Richmond Times-Dispatch reported on Friday that U.S. Bankruptcy Court Judge Kevin R. Huennekens approved the sale of six LandAmerica Financial Group Inc. subsidiaries for $28.5 million. Two of the subsidiaries -- LoanCare Servicing Center Inc. and LC Insurance Agency Inc. -- will be acquired by Fidelity National Financial; the other four go to Georgia-based Buyers Protection Group Inc.
Commercial Mortgage Bond Spreads Narrow Following Announcement that "Legacy Securities" will be Included in TALF Program
The Fed's announcement that certain so-called "legacy securities" will be eligible collateral under the TALF program (see 5/22/2009 posting in this blog) seems to have help create a climate of optimism that has led to a drop in yields on commercial-mortgage-backed bonds. Citing data from Bank of America Corp., a recent Bloomberg report said that the spread on top-rated commercial-mortgage-backed bonds (relative to benchmark interest rates) narrowed 12.3% last week, bringing the spreads to the lowest number since November 5, 2008. Various industry analysts indicated that new "clarity" in the program has increased confidence that the TALF program will be effective in helping revive credit, one noting approvingly that announcements of program details such as applications deadlines (late July for "legacy" assets and June 2 for newly issued CMBS) assuage fears that the program "won't get off the ground."
