If I am a tenant in a foreclosed house in, will I be evicted?

The bank bought it last week. What will happen?

Asked on January 28, 2013 under Real Estate Law, Florida

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 7 years ago | Contributor

Federal law gives certian rights to a tenant in the event that their rental unit is foreclosed on. Accordingly, when a home goes into foreclosure, tenants who have a written lease can continue to occupy it until their lease expires, or 90 days, whichever is longer. The exception to this would be if the new owner intends to move in and occupy the home as their primary residence; in that case, a 90 day notice to move applies. Tenants with a month-to-month lease or no lease at all, have to be given at least 90 days notice to move. However, you should be aware that even if a foreclosure action has already commenced, as long as the landlord remains the owner of record (i.e. is still on the title to the property), the tenant must continue paying rent to them. Therefore, a tenant must be careful to find out just when title to the property passes (e.g. at aucton). Some former landlords have been known to try and continue to collect rent even after they are no longer the owner of the property. That having been said, as a lawful occupant of a property in foreclosure, the tenant should be notified by the mortgage lender as to the sale/transfer date of the property. After this time, the landlord will no longer be the legal owner and the tenant will then be informed as where to they should their rent.  

Note: As to the return of any security deposit, when a property is foreclosed on there may not be much that a tenant can do. In such a situation, generally a tenant’s only legal remedy is to sue the landlord in small claims court. Yet, although they may successfully win a judgment, actually getting the money that they are owed may be difficult to impossible.


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