Your lease does transfer with the property but you might want to talk to the new owners and see what their plans are. They might be willing to let you out of the lease if they eventually want to move in or make renovations. Ask the listing agent if they could contact them for you.... more
The question embodies two separate but entangled matters, the first is whether the act of using the house in trustee sale for generating income, whether for personal use or for making mortgage payment payment, is permissible by law on the basis that owner legally holds title to the property, and if is permissible, second, whether tenant can entitled to any compensation, relocation assistance or return of security deposit, when tenant knowingly has entered into an agreement which has the obvious potential of disruption during the lease period.
The consensus from all replies to the question is that owner can execute the lease because he holds title and that tenant is protected by share existence of the lease. It is true that new owner/banker is obligated to honor the lease, but there is no obligation on thei part of new owner/banker to accommodate the tenant if they choose not to do so, particularly even not so if they they wish to blame the tenant for his own action of knowingly entering into an agreement.
A clarification is needed to identify the agreement as a lessor-lessee agreement signed by an agent of the owner and the lessee, not by the owner himself.
A notice of sale is not the sale itself. The title has not already changed hands, and will not until the foreclosure auction is held. So, until then nothing changes.
A lease, whether recorded or unrecorded and whether between the owner or an agent of the owner, remains in place until foreclosure action wipes out the junior claims. The agreement at that time is terminated, not voided. Some provisions of the lease may survive the termination. A recorded lease notifies lienholders that foreclosure will not give them possession.
Usually the new owner after foreclosure wants the lessee to move out, but may have to bring eviction into play to do so. It might be wise to look around for a new place to live, but not actually commit to moving until the foreclosure actually happens -- it might not take place.... more