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Real estate firm, broker settle claims they threatened tenants

By Jenifer B. McKim
Globe Staff / May 13, 2010

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A Fairhaven real estate company and a Chelsea real estate broker have settled claims they sent threatening notices to tenants living in foreclosed properties in an effort to force them from their homes.

Massachusetts Attorney General Martha Coakley said the notices warned some renters in New Bedford and Roxbury that if they didn’t contact the broker or company immediately they would be removed from their homes, but such eviction tactics violate state and federal laws. Tenants in foreclosed properties have a right to stay put until their leases expire, even if the building is sold, she said.

“Their tenancies, and therefore their right to remain in their homes, simply do not dissolve because of a foreclosure or a resale of the property,’’ said Coakley. “The use of deceptive notices threatening illegal acts by realtors, brokers, and landlords will not be tolerated in Massachusetts.’’

The settlements with Re/Max Classic in Fairhaven and real estate broker Simone Schettino — filed this week in Suffolk Superior Court — prohibit both parties from sending similar notices. They must now inform tenants of their rights to stay in a property, and also identify new landlords.

Re/Max Classic was ordered to give $2,500 to local legal services and consumer aid groups, and Schettino must pay $500 to a consumer aid fund.

The case originated last spring when the attorney general’s office received copies of notices sent by Re/Max Classic to tenants in a New Bedford property that “threatened to illegally change the locks’’ if the renters did not call a broker with the company within 24 hours, according to Coakley’s office.

Schettino allegedly sent similar notices to tenants in a Roxbury property. “The notice threatened to remove all property of the occupant if the real es tate agent was not contacted,’’ Coakley’s office said.

Schettino could not be reached for comment.

Re/Max Classic owner Nick Helgesen said he agreed to the settlement to avoid a larger fine, but believes his offense was benign. He said the company has never changed a tenant’s locks and that the letters he sent simply motivated residents to contact Re/Max Classic. He said the tenants who complained to the state were squatters in a foreclosed property. “We’ve discontinued using the notice,’’ Helgesen said.

Grace Ross, former coordinator with the Massachusetts Alliance Against Predatory Lending, said the case shows that tenants’ rights are still largely misunderstood. “This begins to notify tenants and servicers of the fact they have this right,’’ she said. “We hear frequently of violations.’’

Jenifer B. McKim can be reached at jmckim@globe.com.