Is my lease still in force if the property is sold?
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Is my lease still in force if the property is sold?
I received a letter today from the new owners of the apartments. The only information provided is the new name of the property, the name of the new manager, and that I should make my rent checks payable to a different property name. My lease identifies the previous name I made my checks payable to. The new payee is not whom I entered into agreement with for my lease. Does this mean I don’t have a lease? Am I considered a month-to-month tenant? What about my security deposit?
Asked on March 16, 2011 under Real Estate Law, California
Answers:
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
A sale of rental property does not terminate existing leases. A buyer purchases such property "subject to" and any leases in effect at the time of the sale. That means that the buyer of a property with tenants must honor all leases for the balance of their term. Legally, the new landlord steps into the shoes of the previous landlord. The only way that a sale of a property would terminate a lease is if there was a clause in the lease permitting it. In the absence of such a clause, as long as the tenant is in compliance with all lease terms terms, the landlord cannot evict them.
As for the security deposits, they are transferred to the new landlord who then has the obligation of returning them to the tenants the same as if they were the original landlord. All state laws must be complied with.
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