Foreclosure in Traverse City>Question Details

Dltirado, Renter in San Jose, CA

Leasing a house before it goes to Trustee sale.

Asked by Dltirado, San Jose, CA Tue May 25, 2010

I recently signed a 2 year lease on a single family house in Calif. I have come to find out that the house is set to go to Trustee Sale in 30 days. I contacted my real estate attorney (top in his class at Santa Clara University and practicing for over 20 years), he tells me that if the property is taken back by the bank as a result of no bidders, etc, REO, the bank must honor my lease to its full term. I asked him, "What if the bank sells the property to a third party that wants to owner occupy the property?" He tells me that since the bank took it back first, the third party buyers would also have to honor the lease in its entirety. Does this sound right?

Help the community by answering this question:

Answers

5
Dltirado this sure does not sound right to me but I am not an attorney. One thing ask if this attorney will represent you in future actions regarding this property and, if you lose, at no charge if you follow their advise.
Web Reference: http://www.Find1Home.com
0 votes Thank Flag Link Wed May 26, 2010
I'm not a lawyer, but check with a real estate attorney. Your friend may be a great lawyer, but if real estate isn't his specialty, it's like going to a heart doctor for a face lift. Both great doctors, different specialties.

Not sure about California. Here in Las Vegas (and I'm told this is a national law), if your property is sold at the trustee sale to an investor, the investor also has to honor your lease. However, if the property is sold to someone who intends to owner occupy, you only have 30 days. Sometimes the new owner will negotiate with you and offer you cash for keys to move, but they're not obligated to.

If the property is sold to a 3rd party at the trustee sale, the bank isn't taking it back at all. They are agreeing to sell it for a minimum amount at the trustee sale. So no, I don't believe that's correct.
0 votes Thank Flag Link Tue May 25, 2010
Well, I defer to a real estate lawyer on this. However, ask him to cite the specific statutes that he's referring to that would allow you to continue renting under the terms of your lease.
0 votes Thank Flag Link Tue May 25, 2010
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
Contact
It completely depends on your State Law. Here the lease is negated by the foreclosure. I have only seen 1 bank out of very many that honored a lease then tried to buy the tenant out of the lease. All other banks serve the tenants with eviction notices. Alot of the individual cities have laws that revokes the certificate of compliance upon a foreclosure, so the tenants have to move out.

The way i feel is , if it was me, i wouldnt want to stay in a place with this hanging over me, knowing i would have to leave 1 day, so instead of losing another nights sleep, i would accpet a payout to be able to move on and be secure in where i was living.
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Tue May 25, 2010
Your question got posted on a Michigan site. We in Michigan know nothing of Califonia laws. We are, however, jealous of your sunshine.(in Feb., not today - it's glorious weather here)
0 votes Thank Flag Link Tue May 25, 2010
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2015 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer