Rental Basics in 85032>Question Details

hoffman0373, Renter in Hayward, CA

What happens when a property that I'm renting is forcloed on. My lease has expired and I currently pay month to month

Asked by hoffman0373, Hayward, CA Sun Feb 24, 2013

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June’s answer
Jeff is the only one who got it right on this one. It is very simple and he is right: "Why would the tenant get GREATER privileges due to a foreclosure?" A month to month lease can be terminated by either party with a thirty day notice. That is all a new owner has to provide. And that is assuming that the tenant pays his rent on time to the new owner, starting the day of closing. If the tenant stops paying rent he is in breach of contract and will be evicted very quickly.

Cash for keys is just ridiculous. I cannot believe agents are suggesting to tenants to do that. The only thing a tenant is going to get by doing that is the Sheriff knocking on his door and telling him that he needs to leave immediately (after a short eviction process of course) and an eviction on his record which is going to make it almost impossible to find a new place to rent - and if one can be found expect to pay a hefty premium every month and a hefty security deposit.

Do not try to extort the new owner (for cash for keys), just pay your rent on time and if the new owner asks you to vacate do so at the end of your term. If you are lucky the new owner may give you a new lease. Just be nice and fair and things will work out for you.
0 votes Thank Flag Link Sun Feb 24, 2013
If the property is owned by Fannie Mae, Fredie Mac, Chase or Wells Fargo, there is a law that would allow you to stay in the house as a tenant as long as you continue to pay the rent and be a good tenant. Usually a property managemnt will contct you directly to ask you if you would like o stay or you would like to move out. If you are on a monh to month they might give you the option of a year lease, or month to month. Please feel free to contact me if you have any questions.

Residential Real Estate Professional / Prestige Realty
Bianca Bennett / 602-570-7898
Bianca@InvestInArizonaHomes.com
Website: http://www.InvestInArizonaHomes.com
2 votes Thank Flag Link Thu Mar 27, 2014
Sorry Robert but I respectfully disagree on the issue of a tenant having a 90 day protection clause whilst under a "month-to-month" lease agreement. From a practical standpoint, A lease with the landlord and tenant under a month-to-month lease means exactly that, not "month-to-month (plus) 90 days." That does not change due to foreclosure when a new owner take possession of the home. Why would the tenant get GREATER privileges due to a foreclosure?
I looked under Public Law 111-22 and found no evidence as you presented. Of course it's a huge file so maybe I missed it?
I went to FDIC.gov as they had this simple explanation:
Under the Protecting Tenants at Foreclosure Act:

All tenants must receive a 90-day notice before being evicted as the result of a foreclosure.
With some exceptions, the law requires that in the event of foreclosure, existing leases for renters are honored to the end of the term of their lease.
The stated exceptions are for tenants without a lease, tenants with a lease terminable at will under state law, or where the owner acquiring the property will occupy it as a primary residence. In these cases, the tenants must receive a minimum of 90 days notice to vacate the property.
This law does not affect the requirements of any state or local law that provides longer time periods or other additional protections for tenants.
The new law does not require any agency to issue implementing regulations; these protections apply to foreclosures after May 20, 2009.
FDIC examiners will monitor and enforce compliance with the requirements of this law in the same manner as other consumer protection laws and regulations.

Paragraph #2 spells it out under "tenants with a lease terminable at will..." as an exception.
I've been to court many times under exceptions to the rule. Attorneys and Judges stand with what I presented in the first response I gave.
1 vote Thank Flag Link Sun Feb 24, 2013
As a month-to month renter you will be on "short notice!"

The bottom line here is that you know what is heading in your direction....start making plans now to identify another place of residence. Waiting will only contribute to additional problems.

Good luck,

Bill
0 votes Thank Flag Link Wed Oct 23, 2013
You are getting good advice. You may also want to talk to an area attorney who specializes in landlord/tenant rights.
0 votes Thank Flag Link Wed Oct 23, 2013
Make sure when a home your renting is foreclosed on that your not continuing to pay the landlord/owner that you were paying prior.
0 votes Thank Flag Link Wed Oct 23, 2013
Dear Hoff:

For more information, here is the Arizona Landlord Tenant bill of rights: https://www.azag.gov/sites/default/files/sites/all/docs/civi…

Jeffrey Masich, Realtor, GRI, MBA
HomeSmart Realty
Scottsdale
http://JeffMasich.com
JeffMasich@ArizonaHomesLand.com
480-556-0940
0 votes Thank Flag Link Mon Feb 25, 2013
The “Protecting Tenants at Foreclosure Act”, a Federal Law, ensures tenants receive proper notice of rental home foreclosure and protects them from abrupt or improper removal from the home.

Under this Act – Public Law No: 111-22 (S. 896E) (Enacted: May 20,2009) – a new property owner cannot evict a month-to-month tenant for 90 days. When there is a lease in effect the new owner cannot evict until the tenant’s lease ends. With one exception, when the new property owner is going to use the rental property as his or her primary residence, in this case the new owner must give the tenant 90 days notice. For more information, Google Public Law 111-22. If you have further questions, you should consult a Real Estate attorney.

Hope this helps.
0 votes Thank Flag Link Sun Feb 24, 2013
Speaking about AZ and not CA, as you are on a month-to-month lease, you do not have a valid lease and it will not stand up in court. It is the new owners prerogative if they want to give you cash for keys. I buy at trustee sales for several investors and the company I work with all total buys more than 100 per year. Based on that, I'd say cash for keys is the exception, not the rule for situations like yours. A tenant that wants to "fight back" is typically out in three weeks. And the attorney / court costs are around $300 so it does not make monetary sense for the new owner to offer cash-for-keys.
Now if you had a valid lease (arms length transaction, within 20% of fair market rental rates and a term greater than month-to-month), the new owner may offer a cash settlement to break your lease. Or he may like the terms of your lease and keep you there. Communication and everybody getting along goes a long way!
Any deposits you may have with the former owner will be between you and that party.
0 votes Thank Flag Link Sun Feb 24, 2013
Is this for California or Arizona. Laws vary from state to state.

For the state of Arizona the bank must notify the owner that they are foreclosing on the property and a sign must be posted.

If you're paying month to month then the new owner whom ever that is will probable give you what's called cash for keys to remove yourself from the property within 30 days.

Have you gotten your deposits back from the owner or do they still have them?

I would suggest you contact an attorney or the state you are currently in to find out what your rights are.

Best of luck to you.

Debbie Nieman
Keller Williams Sonoran Living
602-799-5239

http://www.diverdebi.com

http://www.diverdebirealty.com
0 votes Thank Flag Link Sun Feb 24, 2013
Have trustee sales notices been posted on the house?
0 votes Thank Flag Link Sun Feb 24, 2013
Yes. and the property will be sold at auction on May 23rd
Flag Sun Feb 24, 2013
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