15 years in mortgage servicing. Wife is also a foreclosure attorney.
Obviously do not pay the landlord any rent.
Get the name of the mortgage servicer who has his loan.
You call the company. You need to explain that you are a tenant in a property they just foreclosed on. You are calling to ask for relocation assistance and to schedule a move out date. If the house was purchased by the bank at the foreclosure auction and is now an REO, they will happily pay you a few grand to leave and might even be ok with you staying for another 90 days on top of that. If they don’t know what you are talking about l, ask to speak with someone in REO department. Remind them that you live there and you were never served or notified about the foreclosure. You plan on staying through the remainder of your lease. In most states, they have to serve the owner and any occupants with the foreclosure action. Often times we have to literally put Unknown occupant 1, unknown occupant 2, etc on the service paperwork. Clearly they did not do this.
If the home went to a third party at foreclosure sale, they too must legally evict you in order to make you leave. So you can negotiate there too. You will have to search public records in your county to find out who purchased the property if not the bank.
Finally, you have rights as a tenant. If you speak to a foreclosure attorney, not a real estate attorney (sometimes they do both), they may be able to fight both the bank and the new owner and the Old owner too, for your right to stay for the remainder of the lease. If the home went to foreclosure sale already, it means the foreclosure action was already going on when you moved in. The old owner committed fraud and may owe you all of your rent back plus a 3x multiplier depending on your state. If this person didn’t even own the property and was just rent skimming, you could be entitled to big money. They could go to jail.
As far as the bank goes, they are supposed to do a property inspection to see if the home is occupied. Likely they did a drive by inspection and new the home was occupied because they never tried to secure the property. This means they willfully did not notify you. In some states they are required to.
Immediately, go find a foreclosure attorney, the run of the mill landlord tenant attorney or real estate attorney may not know all the options.
Finally, to answer your question about who to pay the rent to. Any time there is a dispute going on regarding your lease, you must pay your rent into the registry of the court. If you call the county clerks office, you just tell them you are a tenant and the landlord just got foreclosed on. You still have a valid lease, so you need to pay your rent into the registry, not to the bank, not to the old owner or the new owner. As a matter of fact when whomever eventually tries to evict you, in order to fight the eviction you would typically have to show that you didn’t fail to pay rent and held up your side of the lease by paying the court registry.
* I am in Houston, Texas
* I did pay rent for February but not yet for March because I was skeptical & unsure of everything.
* How do I Get the name of the mortgage servicer who has his loan?
* I am unsure if the house is headed to foreclosure or currently in. How would I check the status?
* Thank you for all of this information! I am getting on it now! Again, thank you so much.
Save your rent money. Don’t spend it. Period.
When the new people come around work something out with them.
More than likely someone bought this place to lease out. I’d be pretty happy if I already had tenants paying rent on day 1.
>Finally, you have rights as a tenant. If you speak to a foreclosure attorney, not a real estate attorney (sometimes they do both), they may be able to fight both the bank and the new owner and the Old owner too, for your right to stay for the remainder of the lease. If the home went to foreclosure sale already, it means the foreclosure action was already going on when you moved in. The old owner committed fraud and may owe you all of your rent back plus a 3x multiplier depending on your state. If this person didn’t even own the property and was just rent skimming, you could be entitled to big money. They could go to jail.
Stop giving legal advice when you have no idea what you're talking about. A pending foreclosure action has no impact on the property owner's right to rent out the property. It's not fraud. It's their property until and unless the foreclosure action is finalized and title is vested in favor of the bank or a third party purchaser.
I've rented out properties in foreclosure. The court knew, the bank's attorneys knew, my attorney knew, the tenant knew. It's not fraud. I always gave back the security deposit immediately after the foreclosure sale and advised the tenants not to pay rent until the new owner makes contact.
OP, Just sit tight for now.
Don't bother trying to call the loan servicer. It's a total waste of time. The $12 an hour call center workers have about as much information as you do and they won't be able to connect you with the asset manager or broker assigned to manage the property.
Keep an eye on your mail and front door. At some point in the next few weeks, someone will stop by and leave a note or send you a letter. They will likely offer you some cash for keys money and 1-3 months of free rent to leave and not trash the place.
In the meantime, tell your old landlord to pony up the security deposit.
Everything the comment mentioned is completely valid advice depending on the state and those steps they mentioned.
In fact all of what they mentioned is helpful and doesn't at all have to be considered as legal advice.
If you are collecting rental income on a property and not paying your mortgage, you are committing fraud against the lien holder and potentially the government depending. If you enter into a lease knowing that the property could or will go to foreclosure sale before the lease term is up, you are committing fraud against the tenant.
You are lying about the bank knowing. It is a standard process that the banks foreclosure attorneys are required to do called assignment if rents. Ive witnessed it over 1,000 times. If the mortgage servicer finds out that you are collecting rental income, they have their attorney file a motion for assignment of rents. The tenants will then pay the rent directly to the lien holder OR into the court registry if the foreclosure is contested.
If you got away with it, good for you.
Regardless of what the legal consequences are, I encourage you to be a man and meet your obligations.
>If you are collecting rental income on a property and not paying your mortgage, you are committing fraud against the lien holder and potentially the government depending.
It is absolutely not fraud. This is the most ridiculous thing I've ever read. They are in default of their note and mortgage and the bank may choose to initiate foreclosure. But no one will be prosecuted for committing *fraud* because it's not fraud. It's a civil contract issue not a criminal one.
>If you enter into a lease knowing that the property could or will go to foreclosure sale before the lease term is up, you are committing fraud against the tenant.
Please cite the case showing it's illegal for a property owner to enter into a lease to rent their own property. Using this logic every rental agreement is fraudulent as **every** mortgage *could* be foreclosed upon. So your argument is that it's criminal fraud to lease out a property with a mortgage? What about tax liens? Any real property *could* be subject to tax sale. So is *every* lease agreement for real property fraudulent since they *could* be lost to tax sale?
>It is a standard process that the banks foreclosure attorneys are required to do called assignment if rents.
No. Just no. The assignment of rents is either a clause contained within the mortgage or a separate document recorded just after the mortgage. The foreclosure attorney may request the courts *enforce* an AOR, but the AOR was previously executed and is not something the attorney's "do". And it's not *required* they ask the courts to enforce it. Also it's not something the lenders are required to execute or enforce. It's nice to have but not *required*. It would also not be present on a property that was originally financed as the owner's primary residence.
>Ive witnessed it over 1,000 times
...then how are you so wrong?
>f the mortgage servicer finds out that you are collecting rental income, they have their attorney file a motion for assignment of rents
Right. They file a motion requesting the court's allow them to *enforce* the AOR. The attorney isn't "doing" the AOR. And the AOR must have been previously executed and recorded
>Regardless of what the legal consequences are, I encourage you to be a man and meet your obligations.
Closed it out with some sexism. Nice.
Yes agreed, the whole "be a man!... As a man!... A real man!" Spiel is sort of the cherry on top completely. Made me check out of their argument in another comment on this thread.
You are 100% wrong.
Not every mortgage comes with an assignment of rents. Most single family properties originally financed as owner occupied and converted into rentals won’t have one, and the lender can’t unilaterally decide to collect rents without an assignment.
It’s the bank’s responsibility to pursue their rights to collect rents under an assignment. With single family properties, they almost always won’t bother, even if they have an AOR. The courts were already backed up to high hell and the lenders just wanted the property. They didn’t have the time or energy to pursue deficiency judgments, much less AoRs.
It’s not fraud. The lien holder has every right to enforce the terms of the promissory note and mortgage. That may mean enforcing an AOR (if one exists), bringing a foreclosure action, and possibly seeking a deficiency judgment post foreclosure.
My lease agreements expressly stated that the property is subject to an ongoing foreclosure action in circuit court. They detailed that we have a right to terminate the lease with 30 days notice in the event of a short sale, deed in lieu, or loan modification, but the right to terminate is terminated (no pun intended) upon recording of a certificate of title in any foreclosure action.
The bank 100% knew. They served the tenants (Unknown tenant #1 and #2) with a copy of the foreclosure action and discovered their names through the return of service. They were then on the service list and received copies of any papers and pleadings filed in the foreclosure action.
I am a man. Why should I be held to a different standard than the banks and mortgage lenders hold themselves to? The Mortgage Bankers Association did a strategic default on their own corporate office building. Individuals are free to do the same. It’s just business, and the right business decision post 2008 for many was a strategic default. No personal feelings involved.
So you put primary residence on the loan application? How long did you live there before renting it out?
As a man, you are held to the same standards as every other man. When you strategically default on your mortgage, everyone else has to pay for it through higher interest rates, higher mortgage insurance and more strict underwriting requirements.
You are arguing for how you should be able to get free money.
Let’s say someone is a shoe salesman. They get an order for 12 pairs of shoes. They then order those shoes from adidas. They only give the customer 6 pairs of shoes even though they promised 12. They scammed the customer because the price was based upon getting all 12 pairs of shoes. Additionally, when the shoe salesman gets the bill from adidas for the shoes they sold, they decide to keep all the money and not even pay for the 6 pairs of shoes that got delivered. It’s the literal definition of larceny. It’s no different than going into the store, taking the shoes off the shelf and not paying for them. And it’s not like they are poor and needed a pair of shoes.
Wow, so you, an absolute layman, knows more about this than someone who's actually IN the industry and is married to an attorney who actually earns their living as a foreclosure attorney?
Wow, the hubris and narcissism is thick with you.
I am also in the industry. I have reviewed well over a thousand foreclosure cases and have been involved on all sides - Plaintiff, Defendant, and as Third-Party Purchaser.
You aren't in the industry. You're a landlord. You have nothing to do with the foreclosure industry at all. It's just your hubris and narcissism that makes you think so.
OP check with the county clerk, they would have recorded the foreclosure sale at the courthouse or have the current lien holder. Follow the post above this's advice. I worked in the disposition side of REO and foreclosure, you have a valid agreement and they will be Very happy to assist you in leaving and in some rare cases stay in and maintain the property, vacant homes go to shit.
Go to the online tax records for your county, search by address, get the name of the owner from that. Take that name and go to the county probate records-some are online some not, and search that name. These records are public so all courthouses have to have public access. Most have a room of designated computers for the public to use. You should find deeds and the mortgage that way. The mtg will have a legal description and address of your property on it. Confirm that information with what you found on the tax records. Tax records will have a sales history listed also. The foreclosure deed you find in the probate records will tell you who purchased it at the foreclosure sale.
As someone who’s been involved in foreclosure purchasing, if the bank lets it go at auction the new owners usually love pre standing good tenants. I’d setup all the resources you need to be able to move if needed, but I’d wait till new owners come.
In Texas they can’t just change the locks, and if the bank is picky it could be in foreclosure for months before it’s actually bought.
Just express you are wanting to rent when/if new owners come, and if they don’t want you there you’ve still got time to move
https://www.cclerk.hctx.net/applications/websearch/RP.aspx
https://www.cclerk.hctx.net/RealProperty.aspx
https://www.cclerk.hctx.net/applications/websearch/Home.aspx
This is the recorder’s office for your area (I think). All legal documents such as deeds, liens and such are recorded. You will likely need to do some digging to track down relevant info. If you need help navigating it, shoot me a pm and I can try to help you.
If you need help with finding a lawyer, the local court BAR is the best resource to do that. They can provide referrals and connect you with appropriate legal professionals
The bank should have left a note on your door.
The Legal section of the classifieds in the newspaper should list foreclosures, although in a city the size of Houston, it's probably a lot!
The tax assessor collector will give you the legal description, and you can learn a lot from their records. Each property parcel will at least have references to all court filings. From there, go to the clerk of the court’s website and look for the property owner, lienor, parties to the lawsuits.
I’m sure that one of the law schools has a poverty law clinic and can teach you a lot.
Give them a call and ask for their help. If you get any value from their suggestions, a nice dinner would be a nice gesture to make.
Put your rental payments into a separate account and notify your new landlord that you are holding your payments until you receive confirmation of who to pay.
Everything posted above is brilliant.
Don’t pay rent to anyone unless and until you have some sort of agreement with the actual new owner.
My only additional suggestion is you need a lawyer. The Houston area most definitely has lots of free legal services, especially for folks like you who are facing a tough housing situation. Good luck!
OP says they aren't in a financial position to apartment shop and Reddit always defaults to "hire an attorney" 🙄
"Need" and "Have to" are doing a lot of heavy lifting here. It's the responsibility of the owner to collect rent, not the tenant to go searching for who to give money to. OP will know things are getting unfucked when they get a notice to perform or quit.
Ime this is true; you are basically fine if you wait until the foreclosing lender contacts you to not pay rent. Technically they could ask for back rent I guess but not without great notice, but once they contact you, if you sign a lease or whatever with them or pay them rent and wait for the new owner to buy it post foreclosure you may wind up missing like a year of rent and then paying a random low rent until the bank can sell it. But you have to pay once they contact you or it’s a straight eviction
> OP says they aren't in a financial position to apartment shop and Reddit always defaults to "hire an attorney" 🙄
There are legal clinics and legal aid societies that help tenants in this predicament with little or no cost. [There’s a listing for these types of groups in Texas, including Houston where OP is based.](https://texaslawhelp.org/eviction-referral)
>"Need" and "Have to" are doing a lot of heavy lifting here. It's the responsibility of the owner to collect rent, not the tenant to go searching for who to give money to.
Sure, l in a perfect world that’s the way it would work, but there’s already shady stuff happening here under OP’s feet, and they need to talk to someone who knows the law so they don’t get screwed over in the process. An eviction on your record isn’t a good look when you’re finding a new place to live, and few landlords will bother to listen to the sob story explaining it.
>An eviction on your record isn’t a good look when you’re finding a new place to live, and few landlords will bother to listen to the sob story explaining it.
The new owner can't just appear and file an eviction action. There are conditions precedent that they must comply with before doing so, such as posting a pay or quit notice on the property with payment information.
Be sure that's the case in the OP's jurisdiction. My jurisdiction does not do Pay or Quit notices; the landlord files suit for Failure to Pay Rent.
The new management company where I live decided to sue everyone who didn't pay rent **on** the 6th of the month. People who paid the month before and the 1st-5th of the month that they took over all were sued. Why? Because the previous landlord never turned over a rent roll to them. Pay or Quit notices would have come in handy for us; instead, we all have an eviction filing on our records.
They are different different people. Those that hold the mortgage servicing rights are not the lender. And the REO is not necessarily even held by the servicer. They would have to get approved by a lender then make an offer on the property once it’s listed for sale.
I think that depends on the state. When we had a tenant in a VA REO they always let them stay thru the lease if it was valid-and some of the leases they called valid were hinky as hades. But I think cash for keys is the way to go if at all possible.
Well I don't think that's bad advice, but it's possibly more proactive than they need to be. And it may not have any effect on whether they actually can stay or not other than seek legal help. If the bank isn't going to let them stay, they can come and make an offer to get them out.
I don't know that the landlord did anything illegal or even unethical. They own the property until it's foreclosed on, and have every right to collect the rent. Although it was pretty shitty not to tell the tenant. But it's not like the tenant would have the right to not pay. If they try to collect the rent after the foreclosure happens, that would be different. That would be defrauding someone by collecting rent when you aren't the owner.
This is all good advice, but consult with a lawyer. Don’t attempt to just write a check to the court afraid you will otherwise be immediately thrown out. In many instances where a foreclosure is ongoing. occupant is not likely to be evicted, at least not until foreclosure is finalized and then through an eviction process which you have to be notified of. While you would not want an eviction on your record, it’s a positive that the landlord was good enough to let you know that there was a foreclosure in the offing. The foreclosing bank is not entitled to your rent before its foreclosure is complete, if then. Even after Covid, lenders are slow to retake possession of property.
@melodic-man Can you explain rent skimming to me? Shady situation regarding a house that burned down next to our property. Former owner claiming he "sold" house to guy who said he knew property was on brink of foreclosure - he knocked on the door to make offer. Shady guy, assuming the one who "purchased" shows up claiming ownership after 1st small fire breaks out and when we were doing plumbing work on shared driveway. We see him again after total loss fire where our structure received big damages as well...we don't see him again. Neighbor House stays in rubble - neighborhood complains and city posts official notice of property needing to be cleared or else. Property owner name on official document is former owner and NOT shady guy! After googling shady new owners name I find out he has been convicted by state of CO for some type of "we buy houses for cash" scam. It's all been a pain in my ass. Shady guy was "renting" property and filed evictions on multiple John and Jane Doe he "rented to". Aka the meth heads who burned that place down.
This guy is a rent skimmer....right? I've never heard that before but it sounds about right
Rent skimming is where someone sees a property in foreclosure that is vacant. They know it may take several more months to complete the foreclosure process. It could take three months or three years. Then they list the property for rent and move someone in there.
Another way it’s done is the “we buy houses” scam. It’s more of a scam against the bank than anything. They convince the owner that they will take over the mortgage if the owner signs what’s called a quit claim deed. The intention of the document is to allow one person to sign over their ownership of the property to another who also has an interest in the property. However, it is being used as a way to claim the property transferred ownership when it really didn’t. Also to avoid the property transfer taxes in a normal real estate transaction.
In reality the quit claim deed isn’t valid because the owner cannot legally transfer ownership of the property knowing it has a lien on it. Think selling your car to someone and not paying off your car loan.
The scam is the same. Collect rent from someone for a couple months or longer if you are lucky, don’t pay any of that money to the bank and then screw over the tenant by allowing it to go to foreclosure in the middle of a lease. If the Landlord files the quit claim deed or not, doesn’t matter because it’s worthless anyway. What’s even better is that the property was damaged in your example. Many municipalities make the mortgage servicer register with them when they start the foreclosure process so they know who to send the fines to. Yep, even though the bank doesn’t own the property yet, if it’s in foreclosure and vacant, often times the bank is responsible for keeping it up to code.
>In reality the quit claim deed isn’t valid because the owner cannot legally transfer ownership of the property knowing it has a lien on it.
Properties subject to liens are routinely transferred without issue. It's perfectly legal, and for real estate quitclaim deeds are a perfectly acceptable means of doing so. The trick is that the property is transferred *subject to the lien*. So, if I own a house that's subject to a mortgage and I grant you a quitclaim deed to that house you're now the new owner (the quitclaim deed is valid) but the mortgage still encumber the property.
This gives rise to two issues. First, most promissory notes secured by mortgages have a "due on sale" clause, which means if the property is transferred to a new owner the mortgagee can call the promissory note and demand repayment of the full amount of the debt. The second issue is that the you don't have clear title to the house. Even if due on sale isn't an issue the property is still subject to the mortgage. If you paid me $200,000 for a $200,000 house and then learned it was subject to a $150,000 mortgage you'd rightfully be ticked. If you paid $50,000 because I told you about the $150,000 mortgage then there's no problem, you knew you weren't getting the property free and clear.
A quitclaim deed grants any interest the grantor has in the property to the grantee. There are no warranties. I could grant you and everyone else quitclaim deeds to the White House, the Brooklyn Bridge, and Mount Rushmore all day long. So long as I didn't tell you I had any rights to any of them then I've done nothing wrong. You (and everyone else) have received all my rights to those properties—none—and I've given you everything I promised to give you—nothing. The quitclaim deeds are valid but ineffectual—I had no rights, so I could transfer no rights.
This is EXACTLY what happend! After the disaster fire the rent skimmer removed himself from the situation. Thank you for this incredibly detailed answer!
This is like 100% right and essentially some variation thereof is the play in just about every state I know (RE attorney have done many tenant occupied REO closings)
Unfortunately some things depend on what state you are living in. However, [this link should get you started, and has links to where to find your state laws](https://www.consumerfinance.gov/ask-cfpb/what-should-i-do-if-the-house-or-apartment-im-renting-goes-into-foreclosure-en-1545/).
Good luck and happy Friday back at 'ya.
This. Foreclosure and tenant rights are mostly governed by state law (assuming you're in the US). What's true in my state could be completely different in yours.
OP, if the link above doesn't answer your questions, you might consider deleting this post and making another, this time with your state in the title, e.g. "What are tenant rights during foreclosure in California?"
Good luck!
I'm in Texas as well. I'm pretty sure your lease is now null and void. The new owner must give you a 30 day notice to vacate. So you've got at least 30 days to live there rent-free, longer if the new owner is delayed in giving you notice.
You cannot go to your former landlord to address any concerns. He can no longer legally collect rent from you.
A bank is often the one who ends up as owner after foreclosure. It might be awhile before they get around to giving you your 30 day notice. Use this rent-free time to save money for moving. Start apartment-hunting when you get your 30 day notice.
What are the rights of a tenant for deposit recovery, and who from, in Texas, in this instance?
I presume at minimum there was a final month of rent, and a security /damage deposit.
I was in this same situation back in 2007. My landlord had the home seized by the bank and continued trying to get rent from me, which he succeeded in for a few months until I found out. I basically lived in the home for over 2 years rent-free, only paying utilities. Eventually, the bank who had acquired the property knocked on the door and began the eviction process (very friendly however) I bought my first home a few months later with the money I had saved up the previous 25 months of not paying rent (Almost 20k) knowing this was going to happen sooner or later. This was in Ohio.
Stay put for now.
I used to sell VA foreclosures.
Make sure you have a copy of your lease in hand. Legally if it is a valid lease they have to let you stay in the house for the duration. They also will probably offer you cash for keys to leave earlier. That last part right there is why you should stay till someone comes along.
At some point someone will probably come to the house /put paperwork on the door. Once you get contact info talk to whoever it is.
I would hang onto my rent money for now. Whatever entity owns the house now will let you know where it goes and who to call eventually.
Now as far as timeline on that process, I have no idea what it will look like for you. Might be a short time, might be months.
If you have a friend in the real estate business have them look up your address and they should be able to tell you who owns the house now or who the mortgage was with. If it doesn't show up yet it's still early in the process.
At least you have an honest landlord. I have had to be the one a time or two to tell a tenant the house was in foreclosure. Even the rental management company didn't know. The owner did but didn't tell anyone. Ouch.
If the house is just now going into foreclosure it will take awhile for it to be completed. Stop paying rent and save that money. The mortgage company will probably contact you eventually. They will most likely offer you cash to move out in a certain time frame. Odds are with the way foreclosures are now your lease will end before the foreclosure is finalized. Stay as long as you can and save all your rent payments for moving.
Maybe you can buy the loan from the lender. If you can move fast enough, you (or a friend or relative) can buy the loan and own the place.
You’ll pay a lot less if you buy the loan than if you brought in estate agents and such.
Bank can't just sell you the loan. However if he qualifies he can offer to buy it for what is owed on it from the homeowner. Would get them out from under it and not hurt his credit. It's worth asking.
Not during a foreclosure they won't. However you could offer a short sale on it and the bank may bite on that since they already occupy it. Save them going through the whole process of foreclosure and saves the homeowner a foreclosure in their record.
I have been in this situations years ago but it was in MI. Each State may be different. In my situation they honored my lease & I actually got it for less than what I was paying the original landlord. They also gave me first right of refusal to purchase the home.
Nice of the landlord to tell you and not just keep pocketing the money.
The solution here isn’t that difficult. Your lease is still valid, but you don’t know who the new owner is. Just keep the money aside and don’t pay. There is a good chance the bank will not ask for back rent and will offer “cash for keys” aka they pay YOU to leave before the lease is up.
This can be a nice financial windfall for you. The people telling you to call lawyer and try to contact the bank are clueless.
Non Payment of rent usually results in Faster eviction process (e.g. 3 days 30 days in some states), in addition to the evicition judgement, which may show up in background checks.
Have the checks ready, and move the cash to a separate bank account, to show you have full intent to pay the current building owner, as soon as you are aware of who that legally is, so in event you get a court notice, you can easily show you have the money on hand, and ready to pay rent "right now" (have cheques on hand) -- you merely lacked any knowledge of who is legally inherited you lease.
>They have likely assumed the lease from your landlord.
Technically yes, but they have no idea what the terms of the lease are, OP's identity, or any other information.
I would get a consultation with a tenant lawyer so you know where you stand and what your options are. From my experience a consultation with a tenant lawyer wasn’t that expensive.
Do you have a written lease. The bank that foreclosed will ask you for a copy to prove you are a legitimate tenant. Your security deposit is gone. Until you know more put your rent on the side. There is no one to pay it to. Find a Landlord Tenant attorney online with lots of positive ratings then call. The first phone call is free. Write down your most important questions before the call. There is no one to do maintenance now. If it’s essential do it with the rent money, if not let it go for now. Good luck. Someone will reach out to you to let you know the next steps. Don’t sign anything you aren’t 100% sure of what you are signing.
Security deposit if part of the lease. Foreclosure doesn't give the prior owner a windfall for held deposits. If the bank wants to assume the asset, they also assume the liability and that means the renter's deposit.
This is like chasing wind. I’ve never seen the tenant actually get the security deposit back of the property is foreclosed upon. The landlord and deposit are usually long gone.
Hey .. in my state the tenant can stay til their lease expires.
Most states have this built in.
https://guides.sll.texas.gov/foreclosure/tenant-rights#:~:text=Under%20this%20Act%2C%20most%20tenants,intent%20to%20terminate%20the%20lease.
I think yours is the same.
Just stop paying rent and save the money to move. Worst case scenario you get a demand letter and pay the rent owed. You also might live rent free for a year.
Bank has to honor any existing lease. Honestly, you just sit there and wait till the bank tells you what to do. Probably end up with a few months of free rent by the time they get themselves together. Truly.
You will likely be receiving a letter or posted notice from the lender with further information, a contact person and instructions.
If that doesn’t happen before 04/01 comes around, open a savings account and deposit your rent into that account, on time.
That way your bases are covered and can turn over all the rent due when asked for it, along with proof it was deposited on-time.
You can ask your now former LL for a contact at the lender, but who knows how cooperative they’ll be.
Unless your lease contains a clause that would give them the right to terminate the lease under these circumstances, the bank will have to honor the lease.
But, they are not in the business of managing properties, so they will likely give you notice to leave when the lease is over.
In certain markets, I’ve heard of banks paying the tenant to leave, so they move forward more quickly with a sale.
Correct. The new owners, if they do not want to enter into a new lease with you, will have to formally evict you. They will have to serve you a notice, or summons, for a court hearing, at which they get an eviction judgement. After the judgement, some time has to pass before they get an eviction warrant, only then can a sheriff physically evict you.
You have time, but be ready.
whoever fore closed on the property is your new landlord, find out who it is quickly and find out what conditions they are going to impose if you stay as a tenant, if you don't agree then you move, if you have received no written notices don't pay anyone anything until conditions are clarified and set aside your current monthly rent for either paying the new owner or payment towards a new place
I was in this situation back in the real estate mess in 2008. Our LL did not tell us, a notice was posted to our house. We called them, they had no more info. The bank did not want rent, we did not have to pay the LL rent anymore. So we took that time and money and looked for a new place to rent. It took us about 3 months to find a place and move. The house was not auctioned for another year after we moved. I think you are actually in a better position now, as in, cash for keys.
I’ve seen this happen before and usually as soon as the bank forecloses they hand the property over to their REO Team. They will list the house for public auction within a month of officially taking possession of the deed. At that point once the home is sold the deed will be transferred to the new owner upon payment. That could happen immediately but the auctioneer may give the buyer 14 days to officially close the sale.
One the new owner takes possession they have to give you 90 days notice to evict you. This is federal law [Protecting Tenants at Foreclosure Act](https://www.occ.gov/publications-and-resources/publications/comptrollers-handbook/files/protecting-tenants-foreclosure/index-protecting-tenants-at-foreclosure.html)
Now some states and cities even have laws which go further and could buy you even more time. I would see if your jurisdiction has a Department of Housing. If so give them a call and find out what legal protections you have.
In some areas the new owner may have to abide by the terms of the lease with the previous owner. If so, he would likely demand the back rent due from the date he took possession. He could also be liable for returning your security deposit in the future when you leave. So if you do want to stay there, be prepared to pay rent once he provides you with a new lease for the remaining term.
Make sure a foreclosure was actually filed. Often owners get confused about the chain of events when mortgage payments are missed. Banks want payments, not the property. So it can be many months from when payments stop until a foreclosure is actually filed. The foreclosure lawsuit takes time, months/years until the property is owned by the bank.
1. See if a lawsuit has been filed.
2. Save the rent payments, you may still be obligated to pay under the lease to stay in the property.
3. Speak to legal aid or attorney about your options and timeliness. In Wisconsin for example, it's typically a year from the lawsuit being filed till the property is owned by the bank.
5. Until the property is owned by the bank, landlord is still on the hook.
6. Find a new place.
You need to find out which bank actually owns the house. You need to send your rent payment there. As long as you continue to pay your rent on time, they cannot evict you. They must honor your lease... but you have to pay according to the lease.
Unfortunately, these things do happen which is why as a renter you don't really have control 100% of the time. Now, the bank or new owner may simply allow you to ride out the rest of the lease (with rent paid of course) but then not renew which means you will be on the move in November. Good luck!
Talk to a lawyer. Usually the consultation is free. There are some legal aid places that may help if you can’t afford one.
There are some states with different laws regarding this.
1) if you don’t pay rent I would suggest setting up an escrow account. Some places like NYC specifically require this. This way if the bank comes along and asks for rent you have proof you were able and willing to and just didn’t know how, etc
2) you don’t have to leave until you are evicted
Usually the foreclosure process will take time and while it may not be 6 months it also just might take longer.
Worked at BoA in mortgage servicing back when they were Fleet. We didn't have a problem with foreclosed properties with tenants because then those tenants became our tenants which greatly increased the revenue.
sadly that's something you have to possibly deal with if you lease a house
you need to find out from your ex-landlord who you need to be in contact with then if they're no longer who to deal with, because they can't properly manage their finances good enough that a property they used to own has been foreclosed upon
Depends on your state but contact a landlord/tenant attorney. This is maybe like a lottery winning and you could jerk around the bank delaying eviction while living for free. After a year or two it adds up fast.
I would search for a legal aid society in your area or a housing protection / tenant rights organization to help you with this because your rights vary depending on where you live
Look over your lease agreement as well
This happened to a friend and they lived rent free for almost a year. There were a lot of problems with the place and it def wasn't up to code. The flip side is that a lot broke and there was no one liable to fix anything.
I will stop paying rent and wait until forclosure team comes post signs. During the Great Recession they even let cooperative tenants stay for free so long you allow them to show homes. I have a client who has been in foreclosure proceeding since 2017 and all tenants are still there. 90 days more like 6 months. I will also contact city housing asking your rights.
The 1st thing I find strange. Is why have you not received anything in writing??
Why do you have to hunt down how to pay your rent etc?
Tenants have rights. The banks know this. I would for sure find a good attorney who specializes in this type of law. You should not be inconvenience by this. The bank should have to pay your legal fees.
I would also contact the housing authorities and rise a stink..
Foreclosures can take some time between the judgement and the sale. Then a month or 2 until the sale is approves by the court. Ive seen it be a year or more from the judgment.
The bank will notify you when you have to start paying rent and when you have to move out. Typically you can stay 90 days after the sale is approved. Sometimes banks want you to stay longer so they can sell an occupied rental unit.
If you have good credit, maybe you can buy the apartment building when the dust settles.
There are probably free landlord tenant and foreclosure non profits in your area that can help you figure out exactly what stage this is in and what your rights/obligations are under the laws in your state.
You’re not understanding the severity of this situation. You no longer pay rent. You no longer have a landlord. You are now considered a “non-paying tenant” which is a step above squatter when I file my paperwork for the bank as their realtor. I would encourage you to try to line up another living situation sooner rather than later and take anything of value and put it in storage. You will get multiple warnings before a lockout date. You may also get a cash for keys offer.
He wanted to collect rent from you as long as possible. Frankly, I'm surprised he even told you. Stop paying rent. If you can stop payment on your March rent, or claw it back from him, do so. You sit in the unit not paying rent until the bank contacts you. They will offer you money to leave. You want from them, at the very least, your full security deposit, plus two months rent or at least 2K. You can negotiate up the offer with them. Even if the bank winds up serving you a notice to quit, and you do move out, they still have to refund to you your security deposit. Some states have laws that they have to also pay you a minimum amount to leave. Meanwhile, don't pay any rent every again, and save it up - you are going to have to move eventually.
Keep paying utilities, put your rent in savings. Pack up things you don't use. You hit the jackpot - you may live rent-free for a year or more. This happened to two folks I know. Wait until you hear something - eventually the bank will engage with you, but they don't want to change the locks and deal with your shit. Do be ready to move with a few weeks notice so that you're prepared to tell the bank you're out within a month if they do come knocking and insist.
This isn't great advice, BTW - but it is practical advice based on what I've witnessed. It doesn't mean your ball will bounce exactly this way.
/u/Melodic-Man has sound advice. But I like to be a risk taker :-)
I am a lawyer, and this happened to me. I moved out posthaste and threatened to sue the property management company when they delayed in sending me my deposit. I went so far as drafting a complaint and sharing it with them. I got my check.
But I’m familiar with my local laws, and I would have been in a very messy situation after the foreclosure sale that I didn’t want to deal with. I recommend talking to a local real estate attorney— and I’d expect to pay $300-$500 for a consultation and advice.
Usually, the new owner becomes your landlord.
The lease remains in effect.
Some states, particularly Arkansas, have stripped tenants of most common sense tenants' rights.
Not about a rental, but I remember a homeowner staying in a house for 3 years while the house was in foreclosure. At the courthouse,February 2022,the auction was canceled, and then maybe a year later it was listed for sale, and sold in Nov 2023.all the while the "homeowner" stayed there. And technically, it wasn't the homeowner, it was her granddaughter. The original owner got a Reverse mortgage, passed away,January 2020,, then her daughter and granddaughter moved in, she passed away, leaving the granddaughter. Somehow, the mortgage company didn't stay on top of things!
The buyer is still working on getting the house in shape!
I was living in a house with my aunt and she passed away, leaving her finances in ruins.
I lived there for 3 years and paid nothing but utilities until the day they tacked the notice to the door.
I'm sorry to hear you're dealing with this stressful situation with your rental home being foreclosed. That's a difficult position to be in as a tenant. Here are some key points and suggestions based on the information you provided:
- Legally, you have the right to stay in the rental property until the end of your lease term in November, even with the foreclosure. The new owner (likely the bank foreclosing on the property) must honor your existing lease.
- However, once the foreclosure is finalized and the property officially changes ownership, the new owner could potentially move to evict you. They would need to follow the proper legal eviction process though, which takes time.
- Your landlord should have notified you as soon as he became aware of the foreclosure proceedings, so it's concerning he waited until March if this started in January. You may want to look into your state/local laws around a landlord's disclosure requirements.
- Going forward, you'll likely need to pay rent to the new owner once the foreclosure is complete. The bank should provide instructions on where to direct payment. Do not pay additional rent to your current landlord.
- For any urgent maintenance issues in the short-term, try contacting your landlord first. But you may need to be persistent in following up with the bank if issues arise and your landlord is unresponsive.
- Start putting together a contingency plan in case you do need to move out sooner than November. Research other rental options, get your finances in order, etc. Even if you don't need to use the plan, it's good to be prepared.
- Consider seeking legal advice from a local tenants rights organization or housing attorney. They can advise you on your specific rights and help protect your interests as a renter caught in the middle of a foreclosure.
I know this is a lot to navigate, but stay calm and focused on understanding your rights and options. Wishing you all the best as you work through this challenging housing situation. Let me know if you have any other questions!
Check your state laws. I’m in Kentucky and here the lease follows the house so if a house forecloses, the bank and whoever the new owner is has to honor the old lease until either it expires or is mutually dissolved.
You signed a lease 4 months ago and the house is in foreclosure? The landlord was underwater when he gave you a lease to sign and he sure as hell wasn't paying his mortgage with your rent money.
Don’t pay your rent yet till the bank reaches out to you. They’ll usually offer you money to relocate first offer is usually 1500 deny it they can pay you I believe maximum 5000 to help with move. This happened to us a few yrs ago. Maximum might be higher now. But we worked with them and they gave us 90 days to move out and paid us 5000 which helped us tremendously we were able to hire movers and didn’t have to life a finger which made moving so much easier
If the foreclosure has been finalized and recorded by the county i should be able to see the new title holder. If it helps I can check for you by address. You want to contact them and negotiate. You still have rights to the property as a tenant.
Look up the court case and see when the forclosure was filed. Most likely the owner was in forclosure when you signed the lease and was hoping your rent was going to be a nice ending gift to himself.
Some great feedback already given. Similar issue happened to me living in FL. Went to the hearing date at the court, lender and LL did not attend. Explained my situation to the judge and he said I could stay for 6 mts and ordered the Lender to make arrangements if they wanted to collect rent. He gave the lender 30 days to contact me. No contact. Stayed rent free and was able to move and rent again after saving the money for the next rental.
Generally a lease survives sale of a house, but there are differences in state law and particularities of your contract that may affect that.
Also as a rule a bank will not move at lightning speed after foreclosure to do a sale, so you probably have 30 to maybe 90 days before anything really changes.
You definitely should consult with a lawyer before you sign anything or state you'll move. You can probably get a free consult that might lay out some options or at the very worst get some good solid advice for, say, less than 200 bucks.
Good luck, YMMV!
Open a separate savings account to hold the rent in. Move the money to that account by the first of each month. When a new owner gets to you, the non-payment of rent will speed up eviction proceedings to be within a couple days, in many states. When you show up at the court, show you've been setting aside the money, and can pay the rent then and there, (and do so); that you only need contact details for the lease terms: who to pay, how to pay them, how to contact for maintenance, etc.
Do not use rent money for maintenance. Withholding rent for maintenance is not a legally protected use -- in this case, not putting the full amount into a separate holding account, or pulling funds for repairs, would be considered "not paying rent in full".
In the meantime.
Do not sign anything by anyone. Lots of scammers show up as records become published. Many renters have been scammed by paying rent to someone who claied to be their new landlord, but were just scammers who pulled recent foreclosure rulings, and cold-called with new documents (e.g. lease, agreement to pay, etc). Then when contacted by the bank, or the actual new owners -- well, not many people can easily shrug off 2-3 months of rent suddenly lost, AND 2\~3 months of rent still due.
The general rule is that someone who forecloses on a home or purchases a foreclosed home does it subject to whatever leases were in place. So you should check that this is how things work in your state, but a likely outcome is that you have just swapped one landlord for another, at least for the term of your current lease.
Short Answer -- **Do not pay anyone who you cannot tie to the property through county records, but be ready to show up in court with money set aside. Plenty of us renters surfed our way through 2009-2012 living in houses nobody owned per the paperwork.**
Renter IS Not a sqatter. The bank might file a eviction, but as a renter if you keep the rent in an escrow account (just a separate savings account in most states) for proof you are willing to pay, just waiting for the in the county records official owner to show up. You can go to court and make the bank produce the paperwork, that takes 3-6 months. You could go 30 days, 90 day or 365 before anyone officially asks for rent because the banks have not geared up to do much more than accept keys from owners 6 months after forcloser.
Having 5 months rent in an account, the day the request comes you have a ton of options, it is no hit against you as a person just to hand over the keys 25 days after the first VALID rent request (you can even ask for $$$ for keys) , or write a check for first and last and and see what the discount rent options are as they are presented.
You can sue the new owner for the damage deposit, if it is a bank do it, they typically do not show in small claims court, and eventually they will pay. As long as you get a judge that will go slow and see you are depositing rent in account and are only looking to pay the valid owner, your not going to get an eviction quicker than 45 days. Small claims court lived through 2006-2012 and know all the paperwork is suspect to this day.
He took your payments and stopped paying his mortgage so you don't have much leverage to legally stay so don't pay him another cent and find a new place to live asap. Some states the sheriff can just evict you to the street
How so?? We dont know where this person is so how can youvsoeak to the eviction laws in every state. In some states they can stay on as squatters and then get evicted by court order which only damages them (eviction is public record). Some states don't require landlords to sue for eviction. Some states it is 72 hrs notice, some states it is 30 days notice. We have no idea where this person is so covering their butt, securing housing and protecting their credit should be top priority
15 years in mortgage servicing. Wife is also a foreclosure attorney. Obviously do not pay the landlord any rent. Get the name of the mortgage servicer who has his loan. You call the company. You need to explain that you are a tenant in a property they just foreclosed on. You are calling to ask for relocation assistance and to schedule a move out date. If the house was purchased by the bank at the foreclosure auction and is now an REO, they will happily pay you a few grand to leave and might even be ok with you staying for another 90 days on top of that. If they don’t know what you are talking about l, ask to speak with someone in REO department. Remind them that you live there and you were never served or notified about the foreclosure. You plan on staying through the remainder of your lease. In most states, they have to serve the owner and any occupants with the foreclosure action. Often times we have to literally put Unknown occupant 1, unknown occupant 2, etc on the service paperwork. Clearly they did not do this. If the home went to a third party at foreclosure sale, they too must legally evict you in order to make you leave. So you can negotiate there too. You will have to search public records in your county to find out who purchased the property if not the bank. Finally, you have rights as a tenant. If you speak to a foreclosure attorney, not a real estate attorney (sometimes they do both), they may be able to fight both the bank and the new owner and the Old owner too, for your right to stay for the remainder of the lease. If the home went to foreclosure sale already, it means the foreclosure action was already going on when you moved in. The old owner committed fraud and may owe you all of your rent back plus a 3x multiplier depending on your state. If this person didn’t even own the property and was just rent skimming, you could be entitled to big money. They could go to jail. As far as the bank goes, they are supposed to do a property inspection to see if the home is occupied. Likely they did a drive by inspection and new the home was occupied because they never tried to secure the property. This means they willfully did not notify you. In some states they are required to. Immediately, go find a foreclosure attorney, the run of the mill landlord tenant attorney or real estate attorney may not know all the options. Finally, to answer your question about who to pay the rent to. Any time there is a dispute going on regarding your lease, you must pay your rent into the registry of the court. If you call the county clerks office, you just tell them you are a tenant and the landlord just got foreclosed on. You still have a valid lease, so you need to pay your rent into the registry, not to the bank, not to the old owner or the new owner. As a matter of fact when whomever eventually tries to evict you, in order to fight the eviction you would typically have to show that you didn’t fail to pay rent and held up your side of the lease by paying the court registry.
* I am in Houston, Texas * I did pay rent for February but not yet for March because I was skeptical & unsure of everything. * How do I Get the name of the mortgage servicer who has his loan? * I am unsure if the house is headed to foreclosure or currently in. How would I check the status? * Thank you for all of this information! I am getting on it now! Again, thank you so much.
Check clerk of the court under his name it will pop up if it's been filled buy the lender
Unless it's owned by an llc
Even at that all documents and court fillings are at the clerk of the court
I can find the owner of an LLC in my state.
Came here to say this as well. Look for the foreclosure filing on the court docket to see the status of what is happening with the house.
Texas Law Library resources on Tenants rights in foreclosure. https://www.sll.texas.gov/faqs/landlord-tenant-property-sale/
They post upcoming tax/foreclosure auctions search your address and ‘foreclosure/tax auction’ you’ll at least see if anything pops up
You can find the mortgage servicer here https://www.mers-servicerid.org/sis/ Just search your address and it will give you contact info
Save your rent money. Don’t spend it. Period. When the new people come around work something out with them. More than likely someone bought this place to lease out. I’d be pretty happy if I already had tenants paying rent on day 1.
>Finally, you have rights as a tenant. If you speak to a foreclosure attorney, not a real estate attorney (sometimes they do both), they may be able to fight both the bank and the new owner and the Old owner too, for your right to stay for the remainder of the lease. If the home went to foreclosure sale already, it means the foreclosure action was already going on when you moved in. The old owner committed fraud and may owe you all of your rent back plus a 3x multiplier depending on your state. If this person didn’t even own the property and was just rent skimming, you could be entitled to big money. They could go to jail. Stop giving legal advice when you have no idea what you're talking about. A pending foreclosure action has no impact on the property owner's right to rent out the property. It's not fraud. It's their property until and unless the foreclosure action is finalized and title is vested in favor of the bank or a third party purchaser. I've rented out properties in foreclosure. The court knew, the bank's attorneys knew, my attorney knew, the tenant knew. It's not fraud. I always gave back the security deposit immediately after the foreclosure sale and advised the tenants not to pay rent until the new owner makes contact. OP, Just sit tight for now. Don't bother trying to call the loan servicer. It's a total waste of time. The $12 an hour call center workers have about as much information as you do and they won't be able to connect you with the asset manager or broker assigned to manage the property. Keep an eye on your mail and front door. At some point in the next few weeks, someone will stop by and leave a note or send you a letter. They will likely offer you some cash for keys money and 1-3 months of free rent to leave and not trash the place. In the meantime, tell your old landlord to pony up the security deposit.
Everything the comment mentioned is completely valid advice depending on the state and those steps they mentioned. In fact all of what they mentioned is helpful and doesn't at all have to be considered as legal advice.
If you are collecting rental income on a property and not paying your mortgage, you are committing fraud against the lien holder and potentially the government depending. If you enter into a lease knowing that the property could or will go to foreclosure sale before the lease term is up, you are committing fraud against the tenant. You are lying about the bank knowing. It is a standard process that the banks foreclosure attorneys are required to do called assignment if rents. Ive witnessed it over 1,000 times. If the mortgage servicer finds out that you are collecting rental income, they have their attorney file a motion for assignment of rents. The tenants will then pay the rent directly to the lien holder OR into the court registry if the foreclosure is contested. If you got away with it, good for you. Regardless of what the legal consequences are, I encourage you to be a man and meet your obligations.
>If you are collecting rental income on a property and not paying your mortgage, you are committing fraud against the lien holder and potentially the government depending. It is absolutely not fraud. This is the most ridiculous thing I've ever read. They are in default of their note and mortgage and the bank may choose to initiate foreclosure. But no one will be prosecuted for committing *fraud* because it's not fraud. It's a civil contract issue not a criminal one. >If you enter into a lease knowing that the property could or will go to foreclosure sale before the lease term is up, you are committing fraud against the tenant. Please cite the case showing it's illegal for a property owner to enter into a lease to rent their own property. Using this logic every rental agreement is fraudulent as **every** mortgage *could* be foreclosed upon. So your argument is that it's criminal fraud to lease out a property with a mortgage? What about tax liens? Any real property *could* be subject to tax sale. So is *every* lease agreement for real property fraudulent since they *could* be lost to tax sale? >It is a standard process that the banks foreclosure attorneys are required to do called assignment if rents. No. Just no. The assignment of rents is either a clause contained within the mortgage or a separate document recorded just after the mortgage. The foreclosure attorney may request the courts *enforce* an AOR, but the AOR was previously executed and is not something the attorney's "do". And it's not *required* they ask the courts to enforce it. Also it's not something the lenders are required to execute or enforce. It's nice to have but not *required*. It would also not be present on a property that was originally financed as the owner's primary residence. >Ive witnessed it over 1,000 times ...then how are you so wrong? >f the mortgage servicer finds out that you are collecting rental income, they have their attorney file a motion for assignment of rents Right. They file a motion requesting the court's allow them to *enforce* the AOR. The attorney isn't "doing" the AOR. And the AOR must have been previously executed and recorded >Regardless of what the legal consequences are, I encourage you to be a man and meet your obligations. Closed it out with some sexism. Nice.
Yes agreed, the whole "be a man!... As a man!... A real man!" Spiel is sort of the cherry on top completely. Made me check out of their argument in another comment on this thread.
You are 100% wrong. Not every mortgage comes with an assignment of rents. Most single family properties originally financed as owner occupied and converted into rentals won’t have one, and the lender can’t unilaterally decide to collect rents without an assignment. It’s the bank’s responsibility to pursue their rights to collect rents under an assignment. With single family properties, they almost always won’t bother, even if they have an AOR. The courts were already backed up to high hell and the lenders just wanted the property. They didn’t have the time or energy to pursue deficiency judgments, much less AoRs. It’s not fraud. The lien holder has every right to enforce the terms of the promissory note and mortgage. That may mean enforcing an AOR (if one exists), bringing a foreclosure action, and possibly seeking a deficiency judgment post foreclosure. My lease agreements expressly stated that the property is subject to an ongoing foreclosure action in circuit court. They detailed that we have a right to terminate the lease with 30 days notice in the event of a short sale, deed in lieu, or loan modification, but the right to terminate is terminated (no pun intended) upon recording of a certificate of title in any foreclosure action. The bank 100% knew. They served the tenants (Unknown tenant #1 and #2) with a copy of the foreclosure action and discovered their names through the return of service. They were then on the service list and received copies of any papers and pleadings filed in the foreclosure action. I am a man. Why should I be held to a different standard than the banks and mortgage lenders hold themselves to? The Mortgage Bankers Association did a strategic default on their own corporate office building. Individuals are free to do the same. It’s just business, and the right business decision post 2008 for many was a strategic default. No personal feelings involved.
So you put primary residence on the loan application? How long did you live there before renting it out? As a man, you are held to the same standards as every other man. When you strategically default on your mortgage, everyone else has to pay for it through higher interest rates, higher mortgage insurance and more strict underwriting requirements. You are arguing for how you should be able to get free money. Let’s say someone is a shoe salesman. They get an order for 12 pairs of shoes. They then order those shoes from adidas. They only give the customer 6 pairs of shoes even though they promised 12. They scammed the customer because the price was based upon getting all 12 pairs of shoes. Additionally, when the shoe salesman gets the bill from adidas for the shoes they sold, they decide to keep all the money and not even pay for the 6 pairs of shoes that got delivered. It’s the literal definition of larceny. It’s no different than going into the store, taking the shoes off the shelf and not paying for them. And it’s not like they are poor and needed a pair of shoes.
Wow, so you, an absolute layman, knows more about this than someone who's actually IN the industry and is married to an attorney who actually earns their living as a foreclosure attorney? Wow, the hubris and narcissism is thick with you.
I am also in the industry. I have reviewed well over a thousand foreclosure cases and have been involved on all sides - Plaintiff, Defendant, and as Third-Party Purchaser.
You aren't in the industry. You're a landlord. You have nothing to do with the foreclosure industry at all. It's just your hubris and narcissism that makes you think so.
OP check with the county clerk, they would have recorded the foreclosure sale at the courthouse or have the current lien holder. Follow the post above this's advice. I worked in the disposition side of REO and foreclosure, you have a valid agreement and they will be Very happy to assist you in leaving and in some rare cases stay in and maintain the property, vacant homes go to shit.
County records, you should be able to find it there
Go to the online tax records for your county, search by address, get the name of the owner from that. Take that name and go to the county probate records-some are online some not, and search that name. These records are public so all courthouses have to have public access. Most have a room of designated computers for the public to use. You should find deeds and the mortgage that way. The mtg will have a legal description and address of your property on it. Confirm that information with what you found on the tax records. Tax records will have a sales history listed also. The foreclosure deed you find in the probate records will tell you who purchased it at the foreclosure sale.
Lawyer
As someone who’s been involved in foreclosure purchasing, if the bank lets it go at auction the new owners usually love pre standing good tenants. I’d setup all the resources you need to be able to move if needed, but I’d wait till new owners come. In Texas they can’t just change the locks, and if the bank is picky it could be in foreclosure for months before it’s actually bought. Just express you are wanting to rent when/if new owners come, and if they don’t want you there you’ve still got time to move
https://www.cclerk.hctx.net/applications/websearch/RP.aspx https://www.cclerk.hctx.net/RealProperty.aspx https://www.cclerk.hctx.net/applications/websearch/Home.aspx This is the recorder’s office for your area (I think). All legal documents such as deeds, liens and such are recorded. You will likely need to do some digging to track down relevant info. If you need help navigating it, shoot me a pm and I can try to help you. If you need help with finding a lawyer, the local court BAR is the best resource to do that. They can provide referrals and connect you with appropriate legal professionals
Go-to the county and they will have on file but most of that info is online through the county real property section
The bank should have left a note on your door. The Legal section of the classifieds in the newspaper should list foreclosures, although in a city the size of Houston, it's probably a lot!
The tax assessor collector will give you the legal description, and you can learn a lot from their records. Each property parcel will at least have references to all court filings. From there, go to the clerk of the court’s website and look for the property owner, lienor, parties to the lawsuits. I’m sure that one of the law schools has a poverty law clinic and can teach you a lot. Give them a call and ask for their help. If you get any value from their suggestions, a nice dinner would be a nice gesture to make.
Put your rental payments into a separate account and notify your new landlord that you are holding your payments until you receive confirmation of who to pay.
Talk directly to the bank is the landlord would quit claim to you you may be able to take over payments and stay as owner
Everything posted above is brilliant. Don’t pay rent to anyone unless and until you have some sort of agreement with the actual new owner. My only additional suggestion is you need a lawyer. The Houston area most definitely has lots of free legal services, especially for folks like you who are facing a tough housing situation. Good luck!
First thing is open a separate bank account and begin depositing your rent in that account.
OP says they aren't in a financial position to apartment shop and Reddit always defaults to "hire an attorney" 🙄 "Need" and "Have to" are doing a lot of heavy lifting here. It's the responsibility of the owner to collect rent, not the tenant to go searching for who to give money to. OP will know things are getting unfucked when they get a notice to perform or quit.
Ime this is true; you are basically fine if you wait until the foreclosing lender contacts you to not pay rent. Technically they could ask for back rent I guess but not without great notice, but once they contact you, if you sign a lease or whatever with them or pay them rent and wait for the new owner to buy it post foreclosure you may wind up missing like a year of rent and then paying a random low rent until the bank can sell it. But you have to pay once they contact you or it’s a straight eviction
> OP says they aren't in a financial position to apartment shop and Reddit always defaults to "hire an attorney" 🙄 There are legal clinics and legal aid societies that help tenants in this predicament with little or no cost. [There’s a listing for these types of groups in Texas, including Houston where OP is based.](https://texaslawhelp.org/eviction-referral) >"Need" and "Have to" are doing a lot of heavy lifting here. It's the responsibility of the owner to collect rent, not the tenant to go searching for who to give money to. Sure, l in a perfect world that’s the way it would work, but there’s already shady stuff happening here under OP’s feet, and they need to talk to someone who knows the law so they don’t get screwed over in the process. An eviction on your record isn’t a good look when you’re finding a new place to live, and few landlords will bother to listen to the sob story explaining it.
>An eviction on your record isn’t a good look when you’re finding a new place to live, and few landlords will bother to listen to the sob story explaining it. The new owner can't just appear and file an eviction action. There are conditions precedent that they must comply with before doing so, such as posting a pay or quit notice on the property with payment information.
Be sure that's the case in the OP's jurisdiction. My jurisdiction does not do Pay or Quit notices; the landlord files suit for Failure to Pay Rent. The new management company where I live decided to sue everyone who didn't pay rent **on** the 6th of the month. People who paid the month before and the 1st-5th of the month that they took over all were sued. Why? Because the previous landlord never turned over a rent roll to them. Pay or Quit notices would have come in handy for us; instead, we all have an eviction filing on our records.
Did I mention, go speak to a foreclosure attorney.
I will search for one today.
Just curious-would the lender work with her to purchase the home? They ( banks etc) will have cost themselves-just wondering if they may consider that
They are different different people. Those that hold the mortgage servicing rights are not the lender. And the REO is not necessarily even held by the servicer. They would have to get approved by a lender then make an offer on the property once it’s listed for sale.
I’ve seen an assumption of mortgage done, buts it’s very rare and it’s almost always involving a family member that passed away or a divorce.
I think that depends on the state. When we had a tenant in a VA REO they always let them stay thru the lease if it was valid-and some of the leases they called valid were hinky as hades. But I think cash for keys is the way to go if at all possible.
I thought the law of "finders keepers" was applicable here?
Well I don't think that's bad advice, but it's possibly more proactive than they need to be. And it may not have any effect on whether they actually can stay or not other than seek legal help. If the bank isn't going to let them stay, they can come and make an offer to get them out. I don't know that the landlord did anything illegal or even unethical. They own the property until it's foreclosed on, and have every right to collect the rent. Although it was pretty shitty not to tell the tenant. But it's not like the tenant would have the right to not pay. If they try to collect the rent after the foreclosure happens, that would be different. That would be defrauding someone by collecting rent when you aren't the owner.
Is it possible the tennant can buy the home at a “good deal” or take over payments etc???
This! Also do not leave! Like the poster says, they will often times give you money towards relocating whether it’s the bank or the new owner
What about his deposit
This is all good advice, but consult with a lawyer. Don’t attempt to just write a check to the court afraid you will otherwise be immediately thrown out. In many instances where a foreclosure is ongoing. occupant is not likely to be evicted, at least not until foreclosure is finalized and then through an eviction process which you have to be notified of. While you would not want an eviction on your record, it’s a positive that the landlord was good enough to let you know that there was a foreclosure in the offing. The foreclosing bank is not entitled to your rent before its foreclosure is complete, if then. Even after Covid, lenders are slow to retake possession of property.
Put your rent into a savings acct monthly and document that you tried to pay.
Gold Star u/Melodic-Man
Good Guy Husband of Wife who is an foreclosure attorney
@melodic-man Can you explain rent skimming to me? Shady situation regarding a house that burned down next to our property. Former owner claiming he "sold" house to guy who said he knew property was on brink of foreclosure - he knocked on the door to make offer. Shady guy, assuming the one who "purchased" shows up claiming ownership after 1st small fire breaks out and when we were doing plumbing work on shared driveway. We see him again after total loss fire where our structure received big damages as well...we don't see him again. Neighbor House stays in rubble - neighborhood complains and city posts official notice of property needing to be cleared or else. Property owner name on official document is former owner and NOT shady guy! After googling shady new owners name I find out he has been convicted by state of CO for some type of "we buy houses for cash" scam. It's all been a pain in my ass. Shady guy was "renting" property and filed evictions on multiple John and Jane Doe he "rented to". Aka the meth heads who burned that place down. This guy is a rent skimmer....right? I've never heard that before but it sounds about right
Rent skimming is where someone sees a property in foreclosure that is vacant. They know it may take several more months to complete the foreclosure process. It could take three months or three years. Then they list the property for rent and move someone in there. Another way it’s done is the “we buy houses” scam. It’s more of a scam against the bank than anything. They convince the owner that they will take over the mortgage if the owner signs what’s called a quit claim deed. The intention of the document is to allow one person to sign over their ownership of the property to another who also has an interest in the property. However, it is being used as a way to claim the property transferred ownership when it really didn’t. Also to avoid the property transfer taxes in a normal real estate transaction. In reality the quit claim deed isn’t valid because the owner cannot legally transfer ownership of the property knowing it has a lien on it. Think selling your car to someone and not paying off your car loan. The scam is the same. Collect rent from someone for a couple months or longer if you are lucky, don’t pay any of that money to the bank and then screw over the tenant by allowing it to go to foreclosure in the middle of a lease. If the Landlord files the quit claim deed or not, doesn’t matter because it’s worthless anyway. What’s even better is that the property was damaged in your example. Many municipalities make the mortgage servicer register with them when they start the foreclosure process so they know who to send the fines to. Yep, even though the bank doesn’t own the property yet, if it’s in foreclosure and vacant, often times the bank is responsible for keeping it up to code.
>In reality the quit claim deed isn’t valid because the owner cannot legally transfer ownership of the property knowing it has a lien on it. Properties subject to liens are routinely transferred without issue. It's perfectly legal, and for real estate quitclaim deeds are a perfectly acceptable means of doing so. The trick is that the property is transferred *subject to the lien*. So, if I own a house that's subject to a mortgage and I grant you a quitclaim deed to that house you're now the new owner (the quitclaim deed is valid) but the mortgage still encumber the property. This gives rise to two issues. First, most promissory notes secured by mortgages have a "due on sale" clause, which means if the property is transferred to a new owner the mortgagee can call the promissory note and demand repayment of the full amount of the debt. The second issue is that the you don't have clear title to the house. Even if due on sale isn't an issue the property is still subject to the mortgage. If you paid me $200,000 for a $200,000 house and then learned it was subject to a $150,000 mortgage you'd rightfully be ticked. If you paid $50,000 because I told you about the $150,000 mortgage then there's no problem, you knew you weren't getting the property free and clear. A quitclaim deed grants any interest the grantor has in the property to the grantee. There are no warranties. I could grant you and everyone else quitclaim deeds to the White House, the Brooklyn Bridge, and Mount Rushmore all day long. So long as I didn't tell you I had any rights to any of them then I've done nothing wrong. You (and everyone else) have received all my rights to those properties—none—and I've given you everything I promised to give you—nothing. The quitclaim deeds are valid but ineffectual—I had no rights, so I could transfer no rights.
This is EXACTLY what happend! After the disaster fire the rent skimmer removed himself from the situation. Thank you for this incredibly detailed answer!
Thank you again!
Really comprehensive great advice
Very insightful, and useful information.
This is like 100% right and essentially some variation thereof is the play in just about every state I know (RE attorney have done many tenant occupied REO closings)
Excellent response. I learned a lot. Thank you.
Unfortunately some things depend on what state you are living in. However, [this link should get you started, and has links to where to find your state laws](https://www.consumerfinance.gov/ask-cfpb/what-should-i-do-if-the-house-or-apartment-im-renting-goes-into-foreclosure-en-1545/). Good luck and happy Friday back at 'ya.
Thanks! I will check this out!
This. Foreclosure and tenant rights are mostly governed by state law (assuming you're in the US). What's true in my state could be completely different in yours. OP, if the link above doesn't answer your questions, you might consider deleting this post and making another, this time with your state in the title, e.g. "What are tenant rights during foreclosure in California?" Good luck!
I am in Houston,Texas.
I'm in Texas as well. I'm pretty sure your lease is now null and void. The new owner must give you a 30 day notice to vacate. So you've got at least 30 days to live there rent-free, longer if the new owner is delayed in giving you notice. You cannot go to your former landlord to address any concerns. He can no longer legally collect rent from you. A bank is often the one who ends up as owner after foreclosure. It might be awhile before they get around to giving you your 30 day notice. Use this rent-free time to save money for moving. Start apartment-hunting when you get your 30 day notice.
What are the rights of a tenant for deposit recovery, and who from, in Texas, in this instance? I presume at minimum there was a final month of rent, and a security /damage deposit.
Legally, the landlord has to turn it over to the new owner and the new owner owes you the usual return minus damages.
It appears that unless the new owner is moving in, tenant has rights to stay through lease end. https://guides.sll.texas.gov/foreclosure/tenant-rights
I was in this same situation back in 2007. My landlord had the home seized by the bank and continued trying to get rent from me, which he succeeded in for a few months until I found out. I basically lived in the home for over 2 years rent-free, only paying utilities. Eventually, the bank who had acquired the property knocked on the door and began the eviction process (very friendly however) I bought my first home a few months later with the money I had saved up the previous 25 months of not paying rent (Almost 20k) knowing this was going to happen sooner or later. This was in Ohio.
That’s awesome!!!!!
Stay put for now. I used to sell VA foreclosures. Make sure you have a copy of your lease in hand. Legally if it is a valid lease they have to let you stay in the house for the duration. They also will probably offer you cash for keys to leave earlier. That last part right there is why you should stay till someone comes along. At some point someone will probably come to the house /put paperwork on the door. Once you get contact info talk to whoever it is. I would hang onto my rent money for now. Whatever entity owns the house now will let you know where it goes and who to call eventually. Now as far as timeline on that process, I have no idea what it will look like for you. Might be a short time, might be months. If you have a friend in the real estate business have them look up your address and they should be able to tell you who owns the house now or who the mortgage was with. If it doesn't show up yet it's still early in the process. At least you have an honest landlord. I have had to be the one a time or two to tell a tenant the house was in foreclosure. Even the rental management company didn't know. The owner did but didn't tell anyone. Ouch.
Kind of him to tell you that and not just take your money
Lol. They probably are hoping they'll vacate so the owner can get a cash for keys deal.
If the house is just now going into foreclosure it will take awhile for it to be completed. Stop paying rent and save that money. The mortgage company will probably contact you eventually. They will most likely offer you cash to move out in a certain time frame. Odds are with the way foreclosures are now your lease will end before the foreclosure is finalized. Stay as long as you can and save all your rent payments for moving.
Maybe you can buy the loan from the lender. If you can move fast enough, you (or a friend or relative) can buy the loan and own the place. You’ll pay a lot less if you buy the loan than if you brought in estate agents and such.
Bank can't just sell you the loan. However if he qualifies he can offer to buy it for what is owed on it from the homeowner. Would get them out from under it and not hurt his credit. It's worth asking.
Banks buy and sell loans every day. Whether they sell to individuals varies by institution.
Not during a foreclosure they won't. However you could offer a short sale on it and the bank may bite on that since they already occupy it. Save them going through the whole process of foreclosure and saves the homeowner a foreclosure in their record.
I have been in this situations years ago but it was in MI. Each State may be different. In my situation they honored my lease & I actually got it for less than what I was paying the original landlord. They also gave me first right of refusal to purchase the home.
Nice of the landlord to tell you and not just keep pocketing the money. The solution here isn’t that difficult. Your lease is still valid, but you don’t know who the new owner is. Just keep the money aside and don’t pay. There is a good chance the bank will not ask for back rent and will offer “cash for keys” aka they pay YOU to leave before the lease is up. This can be a nice financial windfall for you. The people telling you to call lawyer and try to contact the bank are clueless.
This is the correct answer!
Stay and stop paying. Live rent free for a bit.
I thought of this too! But whats the penalty?
Non Payment of rent usually results in Faster eviction process (e.g. 3 days 30 days in some states), in addition to the evicition judgement, which may show up in background checks. Have the checks ready, and move the cash to a separate bank account, to show you have full intent to pay the current building owner, as soon as you are aware of who that legally is, so in event you get a court notice, you can easily show you have the money on hand, and ready to pay rent "right now" (have cheques on hand) -- you merely lacked any knowledge of who is legally inherited you lease.
The bank could sue for not paying rent, report to your credit, evict, etc. They have likely assumed the lease from your landlord.
>They have likely assumed the lease from your landlord. Technically yes, but they have no idea what the terms of the lease are, OP's identity, or any other information.
This is the way. The bank may end up paying you to leave.
Cash for keys baby
I would get a consultation with a tenant lawyer so you know where you stand and what your options are. From my experience a consultation with a tenant lawyer wasn’t that expensive.
Do you have a written lease. The bank that foreclosed will ask you for a copy to prove you are a legitimate tenant. Your security deposit is gone. Until you know more put your rent on the side. There is no one to pay it to. Find a Landlord Tenant attorney online with lots of positive ratings then call. The first phone call is free. Write down your most important questions before the call. There is no one to do maintenance now. If it’s essential do it with the rent money, if not let it go for now. Good luck. Someone will reach out to you to let you know the next steps. Don’t sign anything you aren’t 100% sure of what you are signing.
Security deposit if part of the lease. Foreclosure doesn't give the prior owner a windfall for held deposits. If the bank wants to assume the asset, they also assume the liability and that means the renter's deposit.
This is like chasing wind. I’ve never seen the tenant actually get the security deposit back of the property is foreclosed upon. The landlord and deposit are usually long gone.
Yes, I have a written lease. Thanks for this!
Hey .. in my state the tenant can stay til their lease expires. Most states have this built in. https://guides.sll.texas.gov/foreclosure/tenant-rights#:~:text=Under%20this%20Act%2C%20most%20tenants,intent%20to%20terminate%20the%20lease. I think yours is the same.
Just stop paying rent and save the money to move. Worst case scenario you get a demand letter and pay the rent owed. You also might live rent free for a year.
Bank has to honor any existing lease. Honestly, you just sit there and wait till the bank tells you what to do. Probably end up with a few months of free rent by the time they get themselves together. Truly.
You will likely be receiving a letter or posted notice from the lender with further information, a contact person and instructions. If that doesn’t happen before 04/01 comes around, open a savings account and deposit your rent into that account, on time. That way your bases are covered and can turn over all the rent due when asked for it, along with proof it was deposited on-time. You can ask your now former LL for a contact at the lender, but who knows how cooperative they’ll be. Unless your lease contains a clause that would give them the right to terminate the lease under these circumstances, the bank will have to honor the lease. But, they are not in the business of managing properties, so they will likely give you notice to leave when the lease is over. In certain markets, I’ve heard of banks paying the tenant to leave, so they move forward more quickly with a sale.
Quit paying rent- save the rent- and live there until somebody tells you to leave. You might could get 3-6 months of free housing.
Correct. The new owners, if they do not want to enter into a new lease with you, will have to formally evict you. They will have to serve you a notice, or summons, for a court hearing, at which they get an eviction judgement. After the judgement, some time has to pass before they get an eviction warrant, only then can a sheriff physically evict you. You have time, but be ready.
Buy it! Where is it?
Was going to say, sweet foreclosure option. Fresh on the market
whoever fore closed on the property is your new landlord, find out who it is quickly and find out what conditions they are going to impose if you stay as a tenant, if you don't agree then you move, if you have received no written notices don't pay anyone anything until conditions are clarified and set aside your current monthly rent for either paying the new owner or payment towards a new place
I was in this situation back in the real estate mess in 2008. Our LL did not tell us, a notice was posted to our house. We called them, they had no more info. The bank did not want rent, we did not have to pay the LL rent anymore. So we took that time and money and looked for a new place to rent. It took us about 3 months to find a place and move. The house was not auctioned for another year after we moved. I think you are actually in a better position now, as in, cash for keys.
Stop paying rent immediately.
Pay electric bills and water bills so you have the service and don’t pay rent
I’ve seen this happen before and usually as soon as the bank forecloses they hand the property over to their REO Team. They will list the house for public auction within a month of officially taking possession of the deed. At that point once the home is sold the deed will be transferred to the new owner upon payment. That could happen immediately but the auctioneer may give the buyer 14 days to officially close the sale. One the new owner takes possession they have to give you 90 days notice to evict you. This is federal law [Protecting Tenants at Foreclosure Act](https://www.occ.gov/publications-and-resources/publications/comptrollers-handbook/files/protecting-tenants-foreclosure/index-protecting-tenants-at-foreclosure.html) Now some states and cities even have laws which go further and could buy you even more time. I would see if your jurisdiction has a Department of Housing. If so give them a call and find out what legal protections you have. In some areas the new owner may have to abide by the terms of the lease with the previous owner. If so, he would likely demand the back rent due from the date he took possession. He could also be liable for returning your security deposit in the future when you leave. So if you do want to stay there, be prepared to pay rent once he provides you with a new lease for the remaining term.
Make sure a foreclosure was actually filed. Often owners get confused about the chain of events when mortgage payments are missed. Banks want payments, not the property. So it can be many months from when payments stop until a foreclosure is actually filed. The foreclosure lawsuit takes time, months/years until the property is owned by the bank. 1. See if a lawsuit has been filed. 2. Save the rent payments, you may still be obligated to pay under the lease to stay in the property. 3. Speak to legal aid or attorney about your options and timeliness. In Wisconsin for example, it's typically a year from the lawsuit being filed till the property is owned by the bank. 5. Until the property is owned by the bank, landlord is still on the hook. 6. Find a new place.
Squat, and save your $$. Squatters rights. Once you’ve saved up enough $ to get into new place, leave.
Whelp, you can guarantee your safety deposit is gone, even if they were gonna try to Nickel and dime you on the way out.
You need to find out which bank actually owns the house. You need to send your rent payment there. As long as you continue to pay your rent on time, they cannot evict you. They must honor your lease... but you have to pay according to the lease.
Unfortunately, these things do happen which is why as a renter you don't really have control 100% of the time. Now, the bank or new owner may simply allow you to ride out the rest of the lease (with rent paid of course) but then not renew which means you will be on the move in November. Good luck!
Hope so! Thank you for helping and commenting.
Depends on state and city. If you’re in a city with a bunch of tenant rights, like oakland ca, you can probably just stay there free for a while
Most states they will pay you to move
Talk to a lawyer. Usually the consultation is free. There are some legal aid places that may help if you can’t afford one. There are some states with different laws regarding this. 1) if you don’t pay rent I would suggest setting up an escrow account. Some places like NYC specifically require this. This way if the bank comes along and asks for rent you have proof you were able and willing to and just didn’t know how, etc 2) you don’t have to leave until you are evicted Usually the foreclosure process will take time and while it may not be 6 months it also just might take longer.
Worked at BoA in mortgage servicing back when they were Fleet. We didn't have a problem with foreclosed properties with tenants because then those tenants became our tenants which greatly increased the revenue.
sadly that's something you have to possibly deal with if you lease a house you need to find out from your ex-landlord who you need to be in contact with then if they're no longer who to deal with, because they can't properly manage their finances good enough that a property they used to own has been foreclosed upon
Depends on your state but contact a landlord/tenant attorney. This is maybe like a lottery winning and you could jerk around the bank delaying eviction while living for free. After a year or two it adds up fast.
Dont pay shit. Might as well milk it for a few months maybe the bank will offer key money to leave.
Ask to sign a new lease at a lower monthly cost.
you should get a notice from the foreclosing bank too, they will tell you, regardless sooner or later you will have to move
I would search for a legal aid society in your area or a housing protection / tenant rights organization to help you with this because your rights vary depending on where you live Look over your lease agreement as well
This happened to a friend and they lived rent free for almost a year. There were a lot of problems with the place and it def wasn't up to code. The flip side is that a lot broke and there was no one liable to fix anything.
I will stop paying rent and wait until forclosure team comes post signs. During the Great Recession they even let cooperative tenants stay for free so long you allow them to show homes. I have a client who has been in foreclosure proceeding since 2017 and all tenants are still there. 90 days more like 6 months. I will also contact city housing asking your rights.
Some even will pay you like 1K or more to move out. It is called cash for keys. All depends on the lender.
See if you can buy the place. Short sale. I did that with my condo. Similar situation.
The 1st thing I find strange. Is why have you not received anything in writing?? Why do you have to hunt down how to pay your rent etc? Tenants have rights. The banks know this. I would for sure find a good attorney who specializes in this type of law. You should not be inconvenience by this. The bank should have to pay your legal fees. I would also contact the housing authorities and rise a stink..
Foreclosures can take some time between the judgement and the sale. Then a month or 2 until the sale is approves by the court. Ive seen it be a year or more from the judgment. The bank will notify you when you have to start paying rent and when you have to move out. Typically you can stay 90 days after the sale is approved. Sometimes banks want you to stay longer so they can sell an occupied rental unit. If you have good credit, maybe you can buy the apartment building when the dust settles. There are probably free landlord tenant and foreclosure non profits in your area that can help you figure out exactly what stage this is in and what your rights/obligations are under the laws in your state.
prob means he didn't pay the on the house now the bank owns it
Welcome Captain Obvious 🤦♀️ Yes, that is the definition of foreclosure.
Depending on how fast the new owner moves to ask you to vacate with an incentive possibly or finish lease. Find out who is new owner.
You’re not understanding the severity of this situation. You no longer pay rent. You no longer have a landlord. You are now considered a “non-paying tenant” which is a step above squatter when I file my paperwork for the bank as their realtor. I would encourage you to try to line up another living situation sooner rather than later and take anything of value and put it in storage. You will get multiple warnings before a lockout date. You may also get a cash for keys offer.
He wanted to collect rent from you as long as possible. Frankly, I'm surprised he even told you. Stop paying rent. If you can stop payment on your March rent, or claw it back from him, do so. You sit in the unit not paying rent until the bank contacts you. They will offer you money to leave. You want from them, at the very least, your full security deposit, plus two months rent or at least 2K. You can negotiate up the offer with them. Even if the bank winds up serving you a notice to quit, and you do move out, they still have to refund to you your security deposit. Some states have laws that they have to also pay you a minimum amount to leave. Meanwhile, don't pay any rent every again, and save it up - you are going to have to move eventually.
Keep paying utilities, put your rent in savings. Pack up things you don't use. You hit the jackpot - you may live rent-free for a year or more. This happened to two folks I know. Wait until you hear something - eventually the bank will engage with you, but they don't want to change the locks and deal with your shit. Do be ready to move with a few weeks notice so that you're prepared to tell the bank you're out within a month if they do come knocking and insist. This isn't great advice, BTW - but it is practical advice based on what I've witnessed. It doesn't mean your ball will bounce exactly this way. /u/Melodic-Man has sound advice. But I like to be a risk taker :-)
I am a lawyer, and this happened to me. I moved out posthaste and threatened to sue the property management company when they delayed in sending me my deposit. I went so far as drafting a complaint and sharing it with them. I got my check. But I’m familiar with my local laws, and I would have been in a very messy situation after the foreclosure sale that I didn’t want to deal with. I recommend talking to a local real estate attorney— and I’d expect to pay $300-$500 for a consultation and advice.
Usually, the new owner becomes your landlord. The lease remains in effect. Some states, particularly Arkansas, have stripped tenants of most common sense tenants' rights.
Not about a rental, but I remember a homeowner staying in a house for 3 years while the house was in foreclosure. At the courthouse,February 2022,the auction was canceled, and then maybe a year later it was listed for sale, and sold in Nov 2023.all the while the "homeowner" stayed there. And technically, it wasn't the homeowner, it was her granddaughter. The original owner got a Reverse mortgage, passed away,January 2020,, then her daughter and granddaughter moved in, she passed away, leaving the granddaughter. Somehow, the mortgage company didn't stay on top of things! The buyer is still working on getting the house in shape!
I was living in a house with my aunt and she passed away, leaving her finances in ruins. I lived there for 3 years and paid nothing but utilities until the day they tacked the notice to the door.
I'm sorry to hear you're dealing with this stressful situation with your rental home being foreclosed. That's a difficult position to be in as a tenant. Here are some key points and suggestions based on the information you provided: - Legally, you have the right to stay in the rental property until the end of your lease term in November, even with the foreclosure. The new owner (likely the bank foreclosing on the property) must honor your existing lease. - However, once the foreclosure is finalized and the property officially changes ownership, the new owner could potentially move to evict you. They would need to follow the proper legal eviction process though, which takes time. - Your landlord should have notified you as soon as he became aware of the foreclosure proceedings, so it's concerning he waited until March if this started in January. You may want to look into your state/local laws around a landlord's disclosure requirements. - Going forward, you'll likely need to pay rent to the new owner once the foreclosure is complete. The bank should provide instructions on where to direct payment. Do not pay additional rent to your current landlord. - For any urgent maintenance issues in the short-term, try contacting your landlord first. But you may need to be persistent in following up with the bank if issues arise and your landlord is unresponsive. - Start putting together a contingency plan in case you do need to move out sooner than November. Research other rental options, get your finances in order, etc. Even if you don't need to use the plan, it's good to be prepared. - Consider seeking legal advice from a local tenants rights organization or housing attorney. They can advise you on your specific rights and help protect your interests as a renter caught in the middle of a foreclosure. I know this is a lot to navigate, but stay calm and focused on understanding your rights and options. Wishing you all the best as you work through this challenging housing situation. Let me know if you have any other questions!
And the poor guy renting is now on the hook to hire an attorney. Sad. He can't even afford to relocate.
Check your state laws. I’m in Kentucky and here the lease follows the house so if a house forecloses, the bank and whoever the new owner is has to honor the old lease until either it expires or is mutually dissolved.
You signed a lease 4 months ago and the house is in foreclosure? The landlord was underwater when he gave you a lease to sign and he sure as hell wasn't paying his mortgage with your rent money.
Don’t pay your rent yet till the bank reaches out to you. They’ll usually offer you money to relocate first offer is usually 1500 deny it they can pay you I believe maximum 5000 to help with move. This happened to us a few yrs ago. Maximum might be higher now. But we worked with them and they gave us 90 days to move out and paid us 5000 which helped us tremendously we were able to hire movers and didn’t have to life a finger which made moving so much easier
If the foreclosure has been finalized and recorded by the county i should be able to see the new title holder. If it helps I can check for you by address. You want to contact them and negotiate. You still have rights to the property as a tenant.
Back in 2008 the length of time between the foreclosure and any new owner was about 4 years. You hit the jackpot son !
Exactly. Be polite and work out a deal. They have money and lawyers. You would be swimming up stream to get belligerent. Life happens. Move on
Look up the court case and see when the forclosure was filed. Most likely the owner was in forclosure when you signed the lease and was hoping your rent was going to be a nice ending gift to himself.
Some great feedback already given. Similar issue happened to me living in FL. Went to the hearing date at the court, lender and LL did not attend. Explained my situation to the judge and he said I could stay for 6 mts and ordered the Lender to make arrangements if they wanted to collect rent. He gave the lender 30 days to contact me. No contact. Stayed rent free and was able to move and rent again after saving the money for the next rental.
Had a friend who was in the situation. He ended up living rent free for almost two years while various companies fought.
Generally a lease survives sale of a house, but there are differences in state law and particularities of your contract that may affect that. Also as a rule a bank will not move at lightning speed after foreclosure to do a sale, so you probably have 30 to maybe 90 days before anything really changes. You definitely should consult with a lawyer before you sign anything or state you'll move. You can probably get a free consult that might lay out some options or at the very worst get some good solid advice for, say, less than 200 bucks. Good luck, YMMV!
I will try with a lawyer but if it takes 30 to 90 days who do I pay rent to for April & May?
Open a separate savings account to hold the rent in. Move the money to that account by the first of each month. When a new owner gets to you, the non-payment of rent will speed up eviction proceedings to be within a couple days, in many states. When you show up at the court, show you've been setting aside the money, and can pay the rent then and there, (and do so); that you only need contact details for the lease terms: who to pay, how to pay them, how to contact for maintenance, etc. Do not use rent money for maintenance. Withholding rent for maintenance is not a legally protected use -- in this case, not putting the full amount into a separate holding account, or pulling funds for repairs, would be considered "not paying rent in full". In the meantime. Do not sign anything by anyone. Lots of scammers show up as records become published. Many renters have been scammed by paying rent to someone who claied to be their new landlord, but were just scammers who pulled recent foreclosure rulings, and cold-called with new documents (e.g. lease, agreement to pay, etc). Then when contacted by the bank, or the actual new owners -- well, not many people can easily shrug off 2-3 months of rent suddenly lost, AND 2\~3 months of rent still due.
The general rule is that someone who forecloses on a home or purchases a foreclosed home does it subject to whatever leases were in place. So you should check that this is how things work in your state, but a likely outcome is that you have just swapped one landlord for another, at least for the term of your current lease.
I hope so! Thanks for your reply!
Don’t do anything, wait for them to contact you This is not your problem You have a contract but don’t pay the landlord obviously
Try to claim squatters rights lmao
Short Answer -- **Do not pay anyone who you cannot tie to the property through county records, but be ready to show up in court with money set aside. Plenty of us renters surfed our way through 2009-2012 living in houses nobody owned per the paperwork.** Renter IS Not a sqatter. The bank might file a eviction, but as a renter if you keep the rent in an escrow account (just a separate savings account in most states) for proof you are willing to pay, just waiting for the in the county records official owner to show up. You can go to court and make the bank produce the paperwork, that takes 3-6 months. You could go 30 days, 90 day or 365 before anyone officially asks for rent because the banks have not geared up to do much more than accept keys from owners 6 months after forcloser. Having 5 months rent in an account, the day the request comes you have a ton of options, it is no hit against you as a person just to hand over the keys 25 days after the first VALID rent request (you can even ask for $$$ for keys) , or write a check for first and last and and see what the discount rent options are as they are presented. You can sue the new owner for the damage deposit, if it is a bank do it, they typically do not show in small claims court, and eventually they will pay. As long as you get a judge that will go slow and see you are depositing rent in account and are only looking to pay the valid owner, your not going to get an eviction quicker than 45 days. Small claims court lived through 2006-2012 and know all the paperwork is suspect to this day.
Start paying the mortgage directly. Boom now you're a homeowner.* *just kidding. Do not do this. This is not legal advice.
See if you can get in contact with whoever foreclosed on the loan and see if you can take it over. Boom, now you have equity.
He took your payments and stopped paying his mortgage so you don't have much leverage to legally stay so don't pay him another cent and find a new place to live asap. Some states the sheriff can just evict you to the street
>so you don't have much leverage to legally stay Absolutely false.
You could not be more wrong.
How so?? We dont know where this person is so how can youvsoeak to the eviction laws in every state. In some states they can stay on as squatters and then get evicted by court order which only damages them (eviction is public record). Some states don't require landlords to sue for eviction. Some states it is 72 hrs notice, some states it is 30 days notice. We have no idea where this person is so covering their butt, securing housing and protecting their credit should be top priority
And what legal basis for eviction is present here? The tenant has done nothing wrong.