can I proceed with a short sale on a home property if the house is occupied with a tenant with a signed lease?

Asked by Debbie, Anthem, AZ Tue Nov 16, 2010

I signed a lease with my renter for 2 years... however i may need to short sale my home soon. What happens to my tenant? and the signed lease?

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Stacy Carter, Agent, Roswell, GA
Tue Nov 16, 2010
Your lease should have a section that outlines what happens in early termination. You most likely have to give a minimum of 60 days notice and there may be some sort of financial compensation for the tenant for disturbing their quiet enjoyment of the property.

The bigger question is why you'd have to short sale at all? Based on your question, I'm assuming the rent is not enough to cover your mortgage. Have you fallen behind on payments with the lender and have you received foreclosure notices?

Full disclosure to the tenant might be the best course of action. The renter may be willing to pay more or better yet, they might be interested in purchasing the property. You probably have options you haven't considered. Talk with a Realtor in your area to see what they might suggest.

Good luck,
Stacy Carter
Associate Broker
Home Appreciators Team at
Better Homes & Gardens Real Estate Metro Brokers
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