I’m selling my mom’s house as her POA because she now has Medicaid and is in a nursing home. My mom has a tenant who’s lease doesn’t end until September. Is the tenant’s lease broken if the house is sold before September?

The tenant signed a lease with my mom, but not with me. The realtor says the
original lease will be broken when the house sells because the tenant has no
lease with me. Is this right?

Asked on June 14, 2017 under Real Estate Law, Virginia

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

The realtor could not be more wrong.
1) Having a power of attorney merely means you are legally entitled to act as your mother's agent or representative; it does not replace her with you on leases, contracts, etc. She is still the lessor and the lease is still with her and still in effect (at least for the duration of its term).
2) When there is an in-effect (unexpired) lease and the property is transferred (other than by a foreclosure and sheriff's sale, which has special rules), the lease remains in effect and the transferee takes the property subject to the lease. So even if you used your POA to transfer the property to yourself before otherwise selling it (e.g. quitclaimed it), the lease (and tenant) goes with the property; and when you sell the property, if the lease has not expired, the buyer purchases a property with a lease and tenant.


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