Gigi Drummond, Renter in Carlsbad, CA

Renting a house that is still up for auction. Landlord is now threatening to take me to Court because for the first time in almost 2yrs - he will not

Asked by Gigi Drummond, Carlsbad, CA Wed Aug 11, 2010

get the rent with the time frame. I lost the Cashier's check. I informed him immediately, Went to the bank - initiated the process - funds will be replaced by the 15th. He wants to charge late fees and take me to Court. The house is up for auction - so is the house he lives in - last month he tried to collect rent twice - didn't fly. He admits to not having paid the mortgage since 2007. I'm tired of this man's tactics. I have to fight back, but need to know how. This is wrong, I know it is, and have nothing left to lose. This is the last straw - Custer's last stand. I'm someone who has paid the rent on time each month - to someone who has not honored their obligations and this is outrageous! I intend to fight this man and let the judge decide that it is OK for him to misrepresent himself by taking a lease on a house that is in foreclosure and then failing to abide by the terms and condidtions of the lease - there is mold in the house, I need advie please respond - Thank You

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21
scott farmer, Agent, Scottsdale, AZ
Tue Mar 8, 2011
I rally feel for you. You have voiced a scenario that is not unlike many others out there caught by the economy. Mia outlined it best for you as far as your rights as a tenant. I'm sure your deposits are gone and you could counter-sue your landlord if they are not returned to you as another option for retaliation. But, in the long run you have to be the one to decide if it's worth it or to just move on. Next time around you may want to put in your lease that deposits are held by a neutral third party trust account like a RE broker or title company and that if the landlord does not pay the mortgage on the property then you no longer have to pay him/her rent until the property forecloses.

Good luck,

Sandy Farmer
Realtor, GRI, CSSN
John Hall & Associates
homesales411.com
Web Reference:  http://homesales411.com
1 vote
Cory La Scala, Agent, San Diego, CA
Wed Aug 11, 2010
All good advice. A lease is a lease, so you're obligated to pay. If the mold is dangerous, hopefully you kept copies of all correspondence to the landlord asking him to have it investigated and repaired if that was deemed necessary by the professionals involved. Sounds like your landlord is in panic mode; he wants the rent while he still owns the house. I can't think of another reason he'd be so unreasonable with a late payment from such a tried and true tenant. If you don't pay, he can still sue you in small claims court after the house is sold, but maybe he's afraid to do that, or maybe he will, it's a toss-up. Good tenants are like gold, and he may be thinking that this is his last month as your landlord, so he better try to get that rent. Definitely go to the Renter's Rights Web site that Alex posted.

Good luck to you!
1 vote
Brook, , San Diego County, CA
Mon Aug 26, 2013
And, do not pay him rent if it was foreclosed.!!!!!!!!!!!!!!!!!!!!!!!!
0 votes
My question is why are you responding to a post that is 2 years old?
Flag Mon Aug 26, 2013
Brook, , San Diego County, CA
Mon Aug 26, 2013
He doesn't own it. Until it is sold or he has proof of redeeming it tell him to pound salt. Your rent free until it is sold he no longer is owner!
0 votes
Timwing, , San Acacia, NM
Wed Mar 9, 2011
0 votes
Timwing, , San Acacia, NM
Wed Mar 9, 2011
there is no conjecture about it! This guy is in San Diego County, and in the UD complaint it states very simply that the plaintiff has to have an interest in the property. Since the interest is now "questionable", he can stand before the c0urt and show that he "has no clothes on"! The court can conclude, with no conjecture, that he is indeed naked and cannot award possession! In the defendant's answer, it is a simple matter to have the court take judicial notice that the plaintiff is not entitled to any rents or damages, and the real complainant would be the mortgage company or the bank. When the plaintiff/owner bought the house, he signed an "assignment of rents", the "conjecture being, he is assigning all rents collected to the bank in the event he does not pay the mortgage! If the house is up for auction, it is all over but the crying since the assignment of rents is past and the property is no longer owned by the guy who wants his rent! Simple matter, no conjecture about it and if the guy tries to action the renter, then he will end up paying more than he thinks!
0 votes
Patricia Joh…, Agent, Sunnyvale, CA
Tue Mar 8, 2011
If possible, find a method of tracking the cashier's check to prove ontime rent paid. If I were a judge, I would conjecture that you withheld the rent and paid late, and if in your lease contract there is stated a late fee, then your landlord is entitled to late fees, they can be imposed. Read your renter's contract. The landlord being in default in his mortgage payment is his problem, not yours. As a tenant, you simply pay rent according to your lease. Once the property sells to a new owner, if he does not want to live in the property, then you may still live there initiating a new lease if your old one expired. You lease is still good even if the landlord is in foreclosure, if it has not expired. A new owner has to abide by your lease. Normally, the present landlord can try to negotiate you out of the lease by offering you paying your moving expenses if the new owner wants to buy and live in the property. What you can hope for is the property sells to someone who doesn't want to live on the property and use it as a rental. You can stay there. A new owner can complete the old lease and reissue his new one if he wants you as a tenant. Otherwise, anticipate a 60-90 Notice to move. Just keep paying your rent...and on time. If there is mold in the house, maybe you ought to move anyway.
0 votes
Timwing, , San Acacia, NM
Tue Mar 8, 2011
screw him, don't worry about it and if he does anything at all retaliatory, you got him! He has a duty to pay the mortgage outfit any rents he collects and if he sues you for eviction, he will have no standing when you show that he is not paying his mortgage! The longer you are in the house, the more likely the new owner will have to pay you to leave! Cash for Keys is not a bad thing!
0 votes
Patricia Joh…, Agent, Sunnyvale, CA
Tue Aug 17, 2010
I'm with you, David. I believe she only has 90 days to move out since the notice was posted...but what I don't understand is what is the ultimate hope renters have in these situations? A lease, is a lease, is a lease, and when signed the obligation is just as strong as any contract of sale. I think many people are confused that it is o.k. to stay living on a property even knowing it is in foreclosure. I wonder how many renters actually live rent-free effectively when in fact, regardless of what the landlord DOES with the rent money is not their concern, their concern is to pay until they are notified to move out by the landlord or the bank. Keeping receipts of payment will hold up in any court situation, and copies of any other paperwork that comes the way of the renter. If the landlord is not paying his mortgage, the renter can show he has paid in good faith to his contract. Doing the right thing is always the winner in every case. If you think the bank doesn't know what is happening, guess what, they do. If you think you can fool a bank, guess what, you can't, won't and shouldn't.
0 votes
Mia Sophia M…, Agent, Claremont, CA
Tue Aug 17, 2010
Hi Gigi!

I can totally sympathize with your situation and I talk to tenants exactly like you multiple times per day! Renttoday.us is a property management firm located in Ontario, California and we manage hundreds of homes that have just gone to trustee sale and are now owned by the bank. The tenants are always very confused, frustrated, annoyed and some do definitely try to take advantage of the situation by withholding rents, stalling, and other tactics.

The bottom line though in your situation is that until the owner officially does not own the home anymore, you need to abide by the contract you agreed to which means paying the rent on time, late fees, etc. Unless his keeping the mortgage current was a contingency of your lease (which it most likely was not) then that fact is irrelevant unfortunately.

Once he actually loses the house and it goes to trustee sale, then you do have rights as a tenant to remain in the home on your existing lease as long as you are paying market rent, it was an arms length transaction, and the home is in relatively good condition. This means you shouldn't have to worry about being displaced or having to relocate unexpectedly. If you choose to move and the bank owns the home you may even have a Cash for Keys option which allows you to relocated and takes care of your moving expenses, etc.

In regards to the mold or whatever other repair issues there may be, you cannot withhold rent for those items unless you have given the landlord sufficient notice of the issues (documented in writing) and have given him "reasonable" time to get the issues repaired. If you did decide to not pay rent, the court wants to see that you have held those funds in an escrow account waiting for the outcome of the decision or you have at least held onto the money and will be able to give it to the owner as soon as he completes the repairs. So many times tenants withhold rent then spend it so by the time the owner fixes the repair, they can't catch up and end up getting evicted anyway! You don't want that to happen.

Look, there are a million rentals available everywhere you go in Southern California. Our website http://www.renttoday.us has new properties every single day to choose from. If you are truly not happy and don't like the situation, then just move out and stop dealing with it. You won't win in court just based on the fact he was in foreclosure and it's going to take weeks to get a court date and a lot of time and frustration. It's your call but I would hate to see you waste a lot of time and energy and still get nothing resolved.

Hope this helped a bit and Good luck!

Sincerely,

Mia Melle, Broker
Renttoday.us | West Coast Property Specialists, Inc.
Toll Free 888.927.7266
http://www.renttoday.us
Web Reference:  http://www.renttoday.us
0 votes
David Dorfman, Agent, Neptune, NJ
Thu Aug 12, 2010
"The day before it went to auction the lender posted a notice on the door that stated on it the tenant had the right to stay for 90 days."

That's the law. If the landlord wanted to collect the rent "and felt bad the tenant gets to stay there for free..." well then the landlord should of paid the mortgage.

Ask the landlord what did they do with rent they WERE collecting each month.

Maybe the landlord can sell their new car or rip out their new bathroom in the THEIR HOUSE....

That's the problem many don't get - including agents.

For an "investment" property to be real investment property, it has to throw off cash after all is said and done. Said and done, includes:

1. Paying the mortgage
2. Paying the taxes
3. Paying for repairs
4. Accounting for vacancies
5. Accounting for non-paying tenants

So if you are a "buyer" looking to become a landlord DO YOUR OWN HOMEWORK, There's really no such thing as a perfect investment or perfect tenant (they're out there though). YOU have to be a perfect landlord.

It's easy to get the rent and go off on a vacation and screw the mortgage, screw the repairs - let the bank take it.

Sometimes, it's near fraud.
Web Reference:  http://www.rentlaw.com
0 votes
Kari Shea, Agent, San Diego, CA
Thu Aug 12, 2010
Hi Gigi,

We strongly recommend you contact an attorney with expertise in tenant / landlord law who also understands foreclosures.

Best of luck to you,

Mark and Kari Shea
Real Estate Experts Serving San Diego County
Specialists in Investment Properties, Foreclosures, Short Sales,
Development Opportunities & Traditional Real Estate
0 votes
Tony Cannon, Agent, Carlsbad, CA
Wed Aug 11, 2010
Your situation is not uncommon as this is a very emotional time in real estate for buyers, sellers, landlords, and tenants. I'm sure the attorneys and CPAs are keeping very busy handling these unusual circumstances. I would recommend contacting the North County Bar Association sponsored Lawyer Referral Service at http://www.lawreferral.org or 760-758-4755 to get in touch with an attorney who can offer advice, and the first 30 minutes of consultion is at no cost to you.
Web Reference:  http://www.lawreferral.org
0 votes
Alex Saavedra, Agent, San Diego, CA
Wed Aug 11, 2010
Hi Gigi,

All this advice is good. If the landlord has failed to abide by the lease and there are mold issues consult an attorney. I have also aded a link for you on California Renter's rights. Good Luck!

http://www.dca.ca.gov/publications/​landlordbook/catenant.pdf
0 votes
Raschel A. K…, Agent, Carlsbad, CA
Wed Aug 11, 2010
Hello Gigi,

I feel your pain. This is a very common situation. I too am not an attorney so I cannot give legal advice. However, I can tell you of situations that my other clients have been through. I would say if you have a lease agreement and in it there is a provision for late fees then you will owe the late fee. I did recently list a home that had tenant in it and was sold for auction. The day before it went to auction the lender posted a notice on the door that stated on it the tenant had the right to stay for 90 days. My client the seller was frustrated because she was no longer the landlord as it was sold and would no longer get to collect the rent and they would essentially stay there for free.
I do not know the legalities to any of this but feel free to contact Troy Terpening. He is a broker and a real estate attorney. http://www.troylawsd.com Before you make any major decisions it may be worth it to you to make a phone call. Good luck Gigi.

Raschel A. Kloos, Realtor 01242504
Realty Executives
760-845-4744
0 votes
David Dorfman, Agent, Neptune, NJ
Wed Aug 11, 2010
I'm not a lawyer. So if you need real legal advice, go see a local landlord tenant group (if they are in your area) or locate a qualified real estate attorney who will represent a tenant.

A couple quick notes:

1. You have a lease with the landlord.

2. The landlord has a mortgage with the lender.

In theory, just because the landlord is in foreclosure wouldn't mean he was going to lose the house. Maybe the lender and owner /lawyer thought renting the house maybe the best way to save it the home. Maybe you pay just enough rent to cover his bills on that home.

When a tenant fails to pay rent to a landlord who depends on that rent to cover his (landlord) monthly payment to the bank - the landlord experiences:

1. anger
2. a late fee from their bank (the lending bank). On many commercial notes, the fee is higher then what the landlord can charge you - so the landlord loses.
3. if the rent is greater then his mortgage, the "profit" - he may be using the profit to pay other bills - and therefore incur even more fees...

Landlords fail when they don't have the funds or heart to cover a vacancy or rent.

Landlords / investors often listen to a realtor / agent who tells them - "it's an easy rental", "you should get more rent .." , "never vacant", "it's easy to cover your bills..."

1. Offer the agent to become your partner by rolling in the commission

2. The agent is not your partner. IF the tenant fails to pay rent, the agent isn't going to lend you money to pay your mortgage.

Do your own math.

The govt is bailing out investors (good thing)
Web Reference:  http://www.rentlaw.com
0 votes
Elisa Peskin, Agent, El Cajon, CA
Wed Aug 11, 2010
Gigi,
I have been in this situation when I was a tenant.
Your landlord still owns the home until the day it sells at the foreclosure auction.
He is therefore entitled to rent, late charges, etc until that time.
It sounds like your best course of action at this time is to pay the rent your landlord is due and find another place to live.
Best of luck to you!
0 votes
Deborah Lon…, , Torrance, CA
Wed Aug 11, 2010
Gigi, you have been given good advice and info so far. If I were the first to answer, I would have basically said much of the same things. My main word to you now is just to repeat. If you are on a month to month lease, you can move out quickly. Call a lawyer & get out of this situation. There is free legal advice. Get that too, if you are unsure how to proceed. Just do it!
0 votes
Scott Miller, Agent, Boca Raton, FL
Wed Aug 11, 2010
Hi Gigi. Why would you continue to give your hard earned money to this loser? Find another place. There must be tons of them in Carlsbad. Review your lease. Ask your attorney to help you GET OUT, not stay and fight. It's useless when you're dealing with a loser owner like this, really.

GOOD LUCK!

Scott Miller, Realty Associates, Boca Raton, FL
0 votes
Don Tepper, Agent, Burke, VA
Wed Aug 11, 2010
See a lawyer.

I'm not a lawyer, so this isn't legal advice. But . . .

Regardless of what he's been doing with the rent you've paid him, you and he have a valid lease. The lease says he'll provide housing and you'll pay rent. It doesn't specify what he does with the money you pay him, just as it doesn't specify where you'll get the money.

So, you owe the rent every month. And, to your credit, you've been paying it.

He's probably correct (it depends on the lease) in assessing you a late fee since your rent wasn't paid on time. However, as a practical matter I'm not sure why he did that. With your rent history, he knows that you've paid on time, and you were prompt in informing him of what happened with the lost cashier's check. A lot of landlords wouldn't have tried to charge a late fee, much less take you to court.

I suspect a lawyer may tell you that while you can fight the landlord, it probably won't get you anywhere. He probably has no assets you can after. And the court would be looking at whether assessing a late fee is justified. What amount are you talking about? $50? $100? Do you really want to spend thousands of dollars on legal fees, maybe time off from work, and so on . . . especially when, technically, the landlord may be right?

I understand your frustration, but your course of action may only lead to more frustration.

Get a lawyer's advice on how to proceed.

Hope that helps.
0 votes
Patricia Joh…, Agent, Sunnyvale, CA
Wed Aug 11, 2010
So....why are you not moving? If it doesn't sell at Auction, then the bank will sell it with an REO agent, and it will eventually sell. I assume you are keeping copies of your rent checks and receipts for the Cashier's Check, right? No matter what occurs with this landlord, you need to focus on YOUR solution, which means you will need to move out. With all the fray going on in the landlord's life, he may never come after you anyway, but fact is, you will need to move, as you cannot live in that house once it is sold. Sometimes it is easier to quit (move) then fight. There is a group called Sentinel which handles landlord disputes. I know that you are determined to make this landlord pay for the grief he has brought to your door. There is mold and there is mold...some IS dangerous...but you may find that the court will be more sympathic to him than you. Just move as soon as you can, get it all behind you, and start fresh in another place. There is no law that I know of about illegally leasing a house that is in foreclosure. If you want to work on something than talk to the Congresspeople in your area about getting a law passed for renter's protection. Next house you rent, be sure you ask this question, or call me & I'll see if its been listed as short sale.. 408-737-1695
0 votes
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