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Eviction tactics squeeze renters: AJC analysis shows landlords increasingly use filings to collect late rent

AJC INVESTIGATION: EVICTION FILINGS

Angela Claxton lived at the Lilburn apartment complex The Columns at Paxton Lane for six years, but it was never easy.

A single mother, Claxton worked multiple jobs to keep her son in Shiloh High’s school zone, but the rent rose year after year. Inevitably, she fell behind, and the management filed to have her evicted.

It happened 32 times.

Claxton never saw her belongings hauled to the curb. Instead, she scraped together the rent, paid the court costs and late fees that came with each filing, and managed to stay put.

The complex felt safe, and it was convenient to her primary job as a certified optometric assistant with Emory Healthcare. Staying meant her son’s education would not be disrupted. Her landlord, Marietta-based ECI Group, took payment through its online system and dismissed the evictions, until it just got to be too much for Claxton.

“This last time was the only time I left the complex,” she said. “I just couldn’t afford to be late on my rent on top of the court fees.”

Claxton is far from alone in facing the threat of eviction over and over again while trying to maintain a stable home.

An unprecedented Atlanta Journal-Constitution analysis of eviction filings from Fulton, DeKalb, Cobb, Gwinnett and Clayton counties found that more than a third of the 1 million cases filed since 2010 were serial filings — filings made within a year of one another at the same property, against a tenant with the same name. The AJC found more than 70,000 cases where renters got three or more eviction notices at the same property.

And such serial filings are becoming more common in recent years, rising 17 percent from 2010 to 2016, even as overall eviction filings fell with the improving economy.

The data on serial filings suggests that landlords are increasingly relying on Georgia’s decades-old laws as leverage to collect overdue rent rather than as an avenue to remove tenants.

“Eviction is not being used as the court of last resort. It’s being used as the court of first resort in many of these cases,” said Matthew Desmond, head of Princeton University’s Eviction Lab, which released data this year showing Georgia is a top state for eviction cases.

For many landlords, the AJC found, eviction filings are standard operating procedure, a process automatically launched when a tenant is late on rent, even by a few days.


The rise in serial eviction filings in metro Atlanta

Since 2010, the number of serial eviction filings has risen in metro Atlanta even as the total number of filings has declined with the improving economy. Most filings do not result in an actual eviction.

Year Serial filings Total filings Percent serial filings
2010 45,268 144,076 31.4
2011 47,707 148,171 32.2
2012 49,442 145,728 33.9
2013 50,632 141,694 35.7
2014 52,330 139,280 37.6
2015 53,475 134,757 39.7
2016 53,046 131,461 40.4

Source: AJC analysis of eviction filing data. Serial filing is defined as a pair of filings on a tenant with the same name at the same property within 365 days of one another.


Falling behind one month often leads to a grueling cycle of repeat filings and eviction fees, leaving a tenant thousands of dollars in the hole with a ruined financial record in the process. Tenants carry those filings with them, making it harder to rent somewhere else, even if they were never actually evicted.

“You’re not putting someone out on the street, but you are threatening to,” said Georgia State University professor and housing expert Dan Immergluck. “It causes housing instability, whether it’s going to directly put them on the street in the next few weeks or not.”

Set against the backdrop of an affordable housing crisis in the Atlanta metro area, the data on serial evictions signals distress among Atlanta’s blue-collar workers, whose rents are increasing faster than their wages.

The housing market in Atlanta depends on tenants paying their rent — and most do. But for thousands of working-class tenants, covering the rent and other bills is a monthly scramble. Repeated filings threaten to push struggling families even further to the margins of poverty.


Map

» EXCLUSIVE: Multifamily properties in metro Atlanta: Eviction filing rates and area demographics mapped


The AJC also found wide variation in eviction filing rates among landlords it identified, suggesting business practices also play a key role in how often landlords file eviction notices.

Landlords are aided by Georgia’s eviction laws, which are among the most favorable in the nation. With strong state laws backing them up, landlords said it would be foolish not to file eviction papers on tenants as soon as possible, even if the aim is to collect rent rather than eject a tenant.

The sheer volume of eviction filings — more than 130,000 a year, or one for every five rental households — shows that they are a key feature of an increasingly unaffordable rental market that includes more than 1.4 million Georgians across five counties.

It also suggests that landlords sign tens of thousands of leases every year at rents tenants cannot afford, a risk-reward calculation by landlords that maximizes profit but sets some tenants up for failure.


‘We are not a social work organization’

Claxton’s landlord, ECI, had among the highest filing rates in 2016 among medium-to-large apartment operators identified by the AJC. According to the AJC’s data, ECI filed about 1,100 evictions that year, or just under one eviction for every two apartments it operated — nearly twice the metro-wide rate.

ECI was also among the most likely to file on a tenant it had already filed on before — two-thirds of its filings were against tenants who already had been filed on within the past year.

CEO Seth Greenberg said his company isn’t the heartless landlord that one might suspect from the AJC’s data. He emphasized ECI rarely removes tenants and said carrying out an eviction is a last resort. He suggested his company might just be more willing to work with tenants who fall behind, while some of his competitors remove a tenant as soon as possible.

ECI allows tenants to stay, if they pay rent, late fees and the court costs associated with filing an eviction.

At the same time, ECI protects its rights as outlined in its leases, and the courts are the way to do that, he said. If the rent isn’t in by the 10th, managers are instructed to file for eviction, he said.

“We provide housing in exchange for rent,” he said. “We are not a social work organization. We try to be empathetic. We try to be sensitive and be humane about it, but we have a job to do.”

Greenberg said landlords can decide to keep a tenant who is late with rent. But from his perspective, he said, not filing for eviction when a tenant is late “would be folly and foolish.”

From her perspective, Claxton said, ECI wasn’t unpleasant when she was late — just “persistent.”

The eviction notices came regularly, tacked to her door and sent through the mail. Georgia law gives a tenant seven days after receiving a notice to file an answer with magistrate court. If the person doesn’t, the eviction goes through. Answering the notices gives tenants a little more time to work out payment before they end up in court with their landlords.

Court costs and late fees ballooned Claxton’s rent from $1,160 to $1,400. Because she was late, she had to pay online, which included a processing fee that got more expensive the longer she waited to pay.

“If it came down to it that you couldn’t pay online, you had to bring a cashier’s check,” she said. “I think I did that twice.”

While scraping together the rent, she fell behind on her car payments. Her father was dying of cancer, and her regular trips to care for him in Jackson, Miss., further strained her finances.

A single mother, Angela Claxton worked multiple jobs to keep her son, Jacob Ricks, in Shiloh High’s school zone, but the rent rose year after year. Inevitably, she fell behind, and the management filed to have her evicted.

“It’s definitely a stressful way to live. They weren’t in the practice of working with you,” she said. “It wasn’t because they wanted me to move. They wanted me to pay.”

Getting tenants to stay and pay is the point, Greenberg said. But he acknowledges that it can put people in a difficult financial position.

“Just like if you had a credit card bill and you have that 18 percent interest. Once you get into the cycle, it’s really hard to get out of it,” he said. “But part of the reason for us that we have the fees that we have is to make it very attractive to pay the rent.”

For tenants like Claxton, the financial burden is great. She was drawn to Paxton Lane by its $700 “move in special” for a two-bedroom apartment, but the rent rose steadily before settling at $1,160 by her final year.

To keep up, she took a weekend job at LensCrafters and worked in the nursery at her church on Sundays. She also took out a payday loan.

“You try to make things work,” she said. “It’s just a vicious cycle. Everything is always late.”

Her 32nd eviction was her last. She was deep in debt and headed toward bankruptcy. She moved in with a friend for a few months, but the eviction filings left her financial reputation in shreds.

In April, she moved in with her mother in a house her sister owns in Clayton County. Her son is completing his education at the Fort Stewart Youth Challenge Academy outside of Savannah. He graduated in June and plans to join the Air Force, she said.

She considers herself lucky.

“Some people just don’t have what I have, a sister with a home to move into,” she said.

Atlanta’s top eviction-filing landlords

The AJC’s analysis of eviction filings in metro Atlanta discovered many landlords that had far higher eviction filing rates than the five-county average. They include:

76.4 58.0 48.4 46.0 23.0 Note: 2016 data for medium to large landlords. Southwood Realty, Ventron Realty and Bridge Investment Group had no comment. | Source: AJC analysis of eviction filing data.

‘There is nothing I can do’

About a dozen people were scattered around Courtroom 1200 C on a recent, rainy Wednesday when DeKalb County Magistrate Judge Corneill Stephens took his seat and launched into a practiced spiel.

“Inability to pay is not a defense,” he told the group.

Lost your job? Car broke down? Got sick? Arrested? None of that matters if you didn’t pay your rent.

“Those are not legal defenses for an eviction action,” he said. “There is nothing I can do about it.”

Federal data shows working class families in Atlanta struggle to find rent they can afford while still providing for other basic needs.

Data from the U.S. Census shows a majority of households making between $20,000 and $50,000 are spending a third or more of their income in rent, a level often referred to as “rent burdened.”

The average hourly wage in Atlanta increased just 4 percent from 2015 to 2018, according to federal labor statistics. Meanwhile, the average rent has increased 19 percent over the same period, from $1,103 in 2015 to $1,309 today.

Once an eviction is filed, a landlord could have a non-paying tenant legally removed in as little as 17 days. Even though filings, court dates and the schedule of the county marshal usually drag out the process, no state moves faster than that.

Tenants in magistrate court almost never have attorneys, while landlords almost always do. As Stephens moved through his list of cases, attorneys for the landlords huddled with tenants to try to work out payment before they came before the judge.

“I encourage you to try to resolve the case, if you can,” Stephens told them.

Many do, but the eviction filing remains on their records.

One of the tenants in the DeKalb courtroom that day was Jerome Holsey, a 49-year-old Gulf War veteran in court for his second eviction proceeding from his Covington Highway apartment complex in less than a year.

Holsey makes his living building sets for the motion picture industry and doing construction and landscaping on the side. The work pays well, but it’s sporadic. He has had a total of six evictions filed on him since 2015, including four from his last landlord.

“Nobody wants to work with you” to get caught up, he said.

Holsey got a reprieve when his landlord’s attorney failed to show up, giving him another week to get the money together. For him, it will be $800 in rent plus $200 in court costs and a $75 late fee.

“They want their money, and I understand a person wanting their money,” he said. “I just wish people would actually work with you instead of (saying) ‘get out!’ I mean, dude, I’m a human too.”

If he can’t work it out with his current landlord, Holsey will have a hard time finding a new place with so many evictions filed against him.

“They will not give you one when you’ve had an eviction within two years, some even five years,” he said.

Before landing his current apartment, Holsey spent a month living in his truck. “I don’t want to do that again,” he said.


Ruined credit, bad options

Stories such as Holsey’s are not uncommon in Atlanta’s rental market. Evictions cases often arise when tenants experience unforeseen tragedies: A family member dies or a steady job is lost, and a family can no longer make ends meet.

But some are the predictable result of business decisions by landlords who weigh the risk that some of their tenants won’t be able to pay against the reward of generating more rent from their properties. To ensure the greatest payoff with the least risk, landlords raise or lower their standards for how good a prospective tenant’s credit must be.

Tweaking those levers increases or decreases the applicant pool without lowering the rent.

“The rent is what the rent is. The question is: Do you have willing participants that have a higher FICO score or a lower FICO score?” Greenberg said, referring to a common measure of individual credit. “As the higher FICO score folks are fewer, you have to expand your pool to find more willing participants.”

Accepting tenants with bad credit keeps apartment complexes full, but also results in more uncollected rent — and more eviction filings against tenants along the way.

Cole Thaler, director of Safe and Stable Homes Project with the Atlanta Volunteer Lawyers Foundation, shows a handy information book of tenants' rights as he speaks to tenants at The Gathering Place in Grove Park on Thursday, May 10, 2018.

Cole Thaler, director of the Atlanta Volunteer Lawyers Foundation’s Safe and Stable Homes Project, said he routinely encounters tenants who have had multiple evictions filed on them. By the time tenants come to AVLF, Thaler said, they are usually in a deep financial hole. Climbing out is almost impossible with serial eviction filings on their records, he said.

“That tenant is going to have a hell of time finding new rental housing because it just looks horrendous,” he said. “I have clients who are couch surfing, living in cars, staying with friends because they had several eviction filings.”

Even if an eviction filing doesn’t show up on a tenant’s credit report, it will show up on a background check because of court filings. Thaler said such checks are routine in apartment complexes.

“It drastically narrows their options,” he said. For his clients, it often means they leave a bad situation only to land in someplace worse because it’s the only place they can find.

Thaler said he tells clients to stay away from big apartment complexes, which all run background checks on prospective tenants.

“Our clients tend to have somewhat better chances renting from mom-and-pop landlords,” he said. “They tend to be a little more understanding.”

But as eviction filings pile up in the Atlanta rental market, Thaler said, even those small-time landlords are running checks.

“I think calling attention to the issue is so necessary and overdue,” he said. “People have to understand how this affects people lives, their children.”


Legal process dates to 1960s

In Georgia, the law encourages landlords to file evictions — early and often — against tenants who fall behind, rather than work out another way to get their rent.

The speed of the eviction process, cash-strapped tenants’ inability to afford lawyers, and the ability to recoup court and attorneys’ costs from their tenants makes it a cheap and effective solution for landlords.

The legal process governing evictions dates to the 1960s, when apartment management was a smaller industry and less corporate. It was long before electronic filing of court documents or the existence of specialized eviction law practices.

There have been minor changes over the years, and the apartment association has lobbyists at the Capitol every year to guard against any actions that would hurt landlords.

“From our perspective, it’s working,” Atlanta Apartment Association President Jim Fowler said of the law. “It’s fairly clear who’s responsible for what.”

Of course, tenants have no such representation at the Capitol and the law bears that out. Once an eviction is filed, tenants may slightly delay the process, but they cannot stop it unless they pay up.

Even then, state law only offers limited protection for renters who catch up after falling behind. Renters can only stop an eviction by paying past due rent and fees only once every 12 months. After that, accepting back rent in an eviction is at the discretion of the landlord.

So when Fowler says state law is working, he means it’s efficient, predictable.

“If you talk to some of our guys, they would say they wish it was a little tighter, a little quicker,” Fowler said. “In reality, that (17 days) hardly ever, if ever, happens.”

Fowler said the ability to file an eviction is “a needed feature of the agreement between the owner and a resident” to protect landlords from financial risk.

“The exposure, the money they have involved, the employees that they have to pay, the vendors that they owe money to — if half the resident base isn’t paying their rent, then that’s not a sustainable business model,” he said.

Filing for eviction is “the absolute last course of action” for a landlord, Fowler said.

“Somebody moves out of that apartment and you have got an empty, vacant apartment not producing revenue,” he said.


Balancing the scales

Few dispute that landlords have a financial stake in enforcing the terms of their leases. If the courts were not there to enforce the terms of the landlord-tenant relationship, the entire housing market of metro Atlanta would collapse. But is filing an eviction on tens of thousands of tenants who pay their rent, even if they pay late, the right answer?

Desmond, of the Eviction Lab, said society shouldn’t accept that the only solution when a tenant is late is to “threaten that tenant with throwing their family on the street.”

Georgia State’s Immergluck said slowing down the eviction process could make it more costly for landlords, discouraging them from employing what he characterizes as a “lazy collections process.”

He said cities like Atlanta could provide legal representation to tenants facing eviction. Voters in San Francisco recently approved such a policy.

“One of the strongest ways to discourage excessive filings is to guarantee legal representation for tenants,” Immergluck said. “That’s one thing that local governments can do.”

Of course, another key to finding a solution is expanding affordable housing options in metro Atlanta, but that’s been hard to realize. The natural growth in new rental units has been centered in the higher-income areas of Atlanta.

Mayor Keisha Lance Bottoms ran on a pledge to bolster affordable housing inside the city by developing a $1 billion public-private trust fund. In February, she announced 51 rental homes on the city’s west side targeted at keeping so-called “legacy renters” in the gentrifying neighborhood. That effort and similar projects are barely a drop in the bucket for financially stressed renters in the city.

As part of its development plan, the Atlanta Beltline was required to create at least 5,600 affordable houses and apartments by 2030. But the AJC reported last year it was way behind on that goal and rising real estate prices were creating the exact opposite outcome.

With relief hard to find, tenants and landlords will continue to be locked in a cycle of repeated eviction filing. For landlords, it’s a logical path. For many tenants, it’s just a fact of life in Atlanta.


Paul Reeser (right), a resident at the complex, supervises volunteers installing a new Kaboom playgound. Willow Branch is an affordable apartment complex that does not rely on evictions as a way to collect rent, bucking a trend in metro Atlanta.

‘Landlords do have discretion’

On a muggy May morning, Katy Perry’s “Roar” was blasting from a tent outside the leasing office at Willow Branch, a 186-unit apartment complex in Clarkston. About 30 yards away, roughly 150 volunteers in blue shirts were busy assembling a massive playground structure that will soon be the new centerpiece for this 46-year-old complex.

Occasionally, a small child peeked out from the balcony of the modest townhouses. Willow Branch is a diverse community with a large number of refugee families.

Most of the volunteers who helped assemble the playground work for Carmax. One, Haris Crnic, lived here two decades ago when his parents fled war in Bosnia for peace in America. He said he immediately volunteered to come back to build a playground for the children of new immigrants.

Volunteers from Carmax help to install a new Kaboom playgound at the complex. Willow Branch is an affordable apartment complex that does not rely on evictions as a way to collect rent, bucking a trend in metro Atlanta.

Unlike a lot of older apartment complexes marketed to lower-income residents, the rent at Willow Branch is geared to make it easy for them to pay. One bedrooms rent for $585. A three-bedroom, two-and-a-half bath townhome goes for $850. As a result, evictions are virtually unknown.

“I think that a lot of landlords just keep raising rent, whether the tenants can afford it or not,” said Margaret Stagmeier, president of TI Asset Management, which owns the complex. “I asked my property manager at Willow Branch how many evictions we had in the last year: zero. It’s because it’s affordable. My average rents were $615 last year. The tenants didn’t need to get evicted because they paid their rent. You can afford that making $10 an hour.”

And the complex is profitable, she said, owing in part to the low turnover rate and its virtually non-existent write-offs of uncollected rent.

According to Stagmeier, her management team doesn’t file for eviction automatically when someone falls behind. Instead, they work with their tenants, pointing them toward resources that can help them get caught up.

“As a management company, you’re obligated. That’s your duty, as an agent, to collect rent. But I do think that landlords do have discretion,” Stagmeier said. “I just don’t think a lot of landlords really spend a lot of time and effort using their discretion. It’s easier to just go to an automatic process.”

The model that sustains Willow Branch isn’t entirely economic. The complex is mission-driven, offering after-school programs, a community garden and other community-building efforts supported in part by a non-profit founded by Stagmeier. Needless to say, most companies don’t operate this way.

For Stagmeier, the issue boils down to affordability. “Philosophically, until our community starts embracing naturally occurring, affordable rents, the eviction problem will continue to fester,” she said.

About the reporters

JoynerChris Joyner is a reporter on the investigative team at the AJC. The Atlanta native concentrates on government accountability at the state and local level.

ErnsthausenJeff Ernsthausen is a reporter and data specialist for investigations at the AJC. A former economic analyst at the Federal Reserve, his previous work includes the AJC’s coverage of sexual abuse by doctors nationwide.

MarianoWilloughby Mariano is a reporter on the investigative team at the AJC covering housing and other issues. She is the winner of multiple local and national investigative journalism awards.

 

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