It sounds like they were paying their rent and now that the home is foreclosed upon, I hope you'll do the right thing and return their security deposit, if there was one. You may also want to refund at least the final month's rent. This will help offset their moving costs as well as reduce the stress they're probably feeling from suddenly being uprooted from their home. Hopefully, the bank or new owner will also provide them with moving assistance in the form of "Cash-for-Keys". Feel free to provide them my info. My team has several fully rehabbed rental homes and we give first chance to renters who have been in this type of situation.
Keller Williams Realty
I guess they are the losers here.
Your family owns (ed) a house that you were renting out to a tenant. Tenant paid cash for the monthly rent and your provided receipts for the payments. Got that part. Now the house has been auctioned, which I read as FORECLOSED on. Is that correct?
If that's the case, tenants need to move out leaving the house in the same condition that they rented it in. They may be able to get a relocation allocation either from the bank's real estate agent or from the person or persons who bought the property at the trustees sale, which ever scenario occurred as you stated when the home was AUCTIONED.
You and or your family can no longer rent the property out or come onto the premises as it now belongs to someone else. In reality as well, any security deposits that you collected from the current tenants should be returned to them. If you so choose to coordinate that with the current owners so that it would be provided to the tenants at the time of move out, you can do that.
Oh and those receipts that you used.....hang onto them and also get a signed receipt from them that you have returned the security deposit to them in full. Utilize a cashiers check for that and take photo copies of everything!!!
Hope that helps......hope we've addressed the right questions, if not, write back or contact me or any of the other agents on Trulia. We are here to help!