Tenant Rights With Foreclosures
In this economy, I get questions all the time about tenant rights when comes to foreclosures. Usually it goes something like, “My landlord is about to be foreclosed on. I need to find a new place to rent.”
Well, not so fast. The recent increase in foreclosures prompted Congress to look into the rights of tenants who remain in the property after a foreclosure. It used to be that a foreclosure sale would extinguish any current lease and the occupants would be “tenants-at-will”, and given or subject to a 5 day vacate the premises notice.
Now, with a new law passed by Congress this May, residential tenants who have entered into a bona fide lease, prior to the notice of foreclosure, is not a relative of the owner, and continues to pay rent, the occupant may stay on the property for the duration of the lease PLUS 90 more days. If it is a verbal, or a month to month lease, then the tenant may stay 90 days after the foreclosure sale.
If the lease was entered into after the notice of foreclosure, the lease may be considered void.
Since we are a full service broker that does both property management and real estate sales (including short sales and pre-foreclosures), we are uniquely positioned to help you with such issues. If you are on either side of this equation, give me a call and I can get you the basics. If your situation doesn’t fit in the normal box, I can refer you to a competent attorney to help you with your case.