Rental Basics in 35802>Question Details

KayBottorpa, Renter in 94112


Asked by KayBottorpa, 94112 Sat Jun 16, 2012

I am looking for a place to rent in the s.f. area. I currently live in san francisco
and pay far below market value..2 bd 1-bth and a yard for my 2 dogs. I am paying 1440,and could go 200. more. Hopefully not homeless in sanfrancisco

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The Protecting Tenants at Foreclosure Act (PTFA) of 2009 required that owners acquiring property through foreclosure (ie banks) honor existing leases. Tenants with term leases could not be evicted until the end of their lease terms and not without a 90-day notice. That is, unless the new owner planned to occupy the primary residence, in which case they could terminate the lease with a 90-day notice. The act also provided additional protections for Section 8 tenants.

That legislation was extended through December 31, 2014. Unfortunately, Congress has not, as yet, done anything to extend that tenant protection into 2015.

Therefore tenants in properties in foreclosure need to look at state and local laws for guidance on tenant evictions involving foreclosures.

According to a recent National Mortgage News article, Wells Fargo said it will no longer follow the guidelines of the expired law. JP Morgan Chase, Citigroup and Nationstar have said they will voluntarily continue to follow the PTFA rules. Both Fannie Mae and Freddie Mac are supposed to continue to follow the expired law for their REO inventories.

Very few states offer the same protections for tenants as the expired federal law and 17 states have no specific tenant protections in foreclosure situations, allowing the banks/other new owners to immediately evict tenants following a foreclosure sale. In many states a foreclosure terminates the rights of tenants, so without the expired federal law, the new owner does not have to file a separate eviction notice to remove tenants in the property.

Anyone currently renting a property in foreclosure should pay close attention to these changes.
1 vote Thank Flag Link Sun Mar 1, 2015
An excellent answer which will hopefully be read by many!
Flag Sun Mar 1, 2015

It depends on the situation but sometimes, even in a foreclosure situation you can remain in the home. Check with the lender who holds the mortgage because you may be able to pay your rent to them. Typically, it keeps their investment safer to have a tenant in it.

I would check with a local attorney but I don't believe they can kick you out if you have a lease and continue to pay your rent as agreed upon in that contract.

However, sometimes the lender doesn't want to do that and will offer a tenant "cash for keys" (remember that phrase) to get you out of the property and you can use that money to make your move. If that's the case, be sure you know exactly when you have to be out because if you do not remove your belongings by that set period, they may become property of the lender.

If the lender allows you to stay and the property sells while you live in it, if the purchaser is an investor, you may be able to continue your lease until it runs out. At that time, they may choose to continue the lease or draw up a new one. If they draw up a new one, they can price it at fair market value so the rent will likely go up so be prepared for that.

Definitely check with the local authorities though before making a huge move and have an alternative plan in place if you do have to move.
0 votes Thank Flag Link Sun Mar 1, 2015
Check out the local newspaper and craig's list (use both with a cautious eye - lots of little scammers out there)
0 votes Thank Flag Link Sat Jun 16, 2012
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