Foreclosure in 85381>Question Details

Gilbertduran, Renter in Peoria, AZ

My landlords house went in to foreclsure and is going to be actioned september 28 ,2010. My questin is do I have to pay him the September rent ?

Asked by Gilbertduran, Peoria, AZ Tue Aug 17, 2010

the house was appointed to a lawyer to be trustee of the property .HE STILL HAS OUR DEOSITS IN THE AMOUNT OF $ 1545.00, to tell you the truth I don't think he has the money to return. he says that I will get my money when he gets paid for the house. the way I see it ,he can't do that.
It is not his house any more,correct.

Help the community by answering this question:


You need to consult an attorney. But if you have a legally binding lease agreement, obligating you to pay rent, then you are bound by that lease to pay the rent. The owner's/landlord's problems (foreclosure or otherwise) do not supersede your lease agreement - in my personal opinion. But I am not an attorney, and you truly do need legal advice, not real estate advice.

Best of luck!
1 vote Thank Flag Link Wed Aug 18, 2010
The house is still your landlord's until the trustee sale takes place. At that point either a 3rd party or the foreclosing lender will take ownership of the home. In most cases the landlord doesn't have the funds to return the deposits nor do they usually care to return them. It's sad!

The only way that the owner will get paid any proceeds would be if the amount that the home sold for at the trustee sale was more than all of the liens against the home. The liens will be paid first and then the trustor (previous homeowner) will receive the balance. In AZ, this is rare that there are any funds remaining because most trustee sales the homes are upside down.
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0 votes Thank Flag Link Tue Nov 2, 2010
Your lease says you have to pay him, although his mortgage and promissory note says the same thing. Two wrongs don't make a right, but I am guessing he doesn't have the time or money to go after you. I would renegotiate a reduced rent and also get the cash for keys money at the end from the lender.
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0 votes Thank Flag Link Tue Nov 2, 2010
I agree with Randy's advice. Most likely you have a binding lease agreement and are obligated to pay, but confirm with an attorney if you don't understand your agreement. Also, the house belongs to your landlord until the foreclosure is final and has been auctioned off at the trustee sale.

This link provides some info about your rights in this situation, again consult with an attorney to understand your rights under both Federal and State laws.
0 votes Thank Flag Link Wed Aug 18, 2010
Yes, you have a contract that obliges you to pay the lease. Is there anything in the lease regarding what happens in this situation? We've been putting in clauses for just this for the last couple of years as it has become more of a problem.

I have seen tenants put their rent money, up to the amount of the deposit, into an escrow account after the foreclosure to ensure they recover their deposit. Not advising you to do this as it is probably a violation of the lease contract. As others have said, consult an attorney to determine your options.

You could ask him to show you, on paper, where the money is coming from. Perhaps he can do that? You might also want to familiarize yourself with the foreclosure process so that you have some idea of how long you will be able to stay in the house.
0 votes Thank Flag Link Wed Aug 18, 2010
Maureen Fran…, Real Estate Pro in Birmingham, MI
In addition, to what Randy has already stated, I must caution you. I have witnessed first hand where renters in this situation were evicted in the end and that eviction stayed on their record. And that was in spite of the fact that they were current on their rent.

Not sure what you're waiting for, but I would suggest you pay the rent that you owe, talk with a real estate attorney about the ramifications of moving out ahead of your lease - if you have one. Your deposit should be honored and returned to you or at least mounted as a lien against the property. Again, a real estate attorney can help you in more detail.

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0 votes Thank Flag Link Wed Aug 18, 2010
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