Do I have to continue paying rent if my home has been forclosed?
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Do I have to continue paying rent if my home has been forclosed?
Our lease ends in bout 2 months but the house has been officially foreclosed on. We pay a realty company that is being used by the actual homeowner. Should we not pay the remaining months and give a 30 day notice? We can put the money for the remaining months in an bank account to show we have the money but don’t know where it is going due to our concerns.
Asked on May 3, 2017 under Real Estate Law, Colorado
Answers:
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 6 years ago | Contributor
Even if a foreclosure action has already been filed, as long as the landlord remains the owner of record that (i.e. is still on the title to the property), you must continue to pay rent to them. As a lawful occupant of the property, you should be notified by the mortgage lender as to the sale/transfer date of the property (after this time your landlord will no longer be the legal owner). You should then be informed where to send your rental payments. One thing you should be aware of is that sometimes an incentive can be negotiated between a new owner and a tenant whereby the tenant will agree to move out prior to the end of the lease. This incentive is known as “Cash for Keys”. Basically, tenant is paid by the owner to leave the property early. The exact amount and timing of the payment can be worked out on a case-by-case basis.
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 6 years ago | Contributor
If as you indicate the foreclosure has occured and is final (e.g. the home has been sold at a foreclosure sale or auction), you no longer need to pay: foreclosure, when it occurs, terminates all your landlord's rights to the property and his interest in it, thereby terminating the landlord-tenant relationship.
If foreclosure has been filed but is not yet final, you have to pay; until it if final, the owner is still your owner and your landlord still your landlord.
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