If my landlord is losing the home thatI rent due to foreclosure, what are my rights as a tenant?

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If my landlord is losing the home thatI rent due to foreclosure, what are my rights as a tenant?

I was just informed that my landlord received a notice that her home will go up for auction on 2 weeks from no. I rent a small mother-in-law type apartment on the property. What are my rights as a tenant who pays month-to-month if that happens? She has also mentioned that she wants to try a short sale and may file for bankruptcy. Are my rights the same for all 3? She is also providing utilities under the rental agreementbut said that she is shutting everything off since she is moving. She owes me a $1000 security deposit. What are my rights?

Asked on February 10, 2011 under Real Estate Law, California

Answers:

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

Answered 10 years ago | Contributor

I would just like to clarify your rights in a foreclosure situation.  Federal law gives some rights and protection to a tenant in the event that their rental unit is foreclosed upon. The “Protecting Tenants at Foreclosure Act” requires that when a home goes into foreclosure, tenants who have a written lease can continue to occupy the home until the end of the lease period, or 90 days, whichever is longer. Those tenants with a month-to-month lease, or no lease at all, have to be given at least 90 days notice to move.

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

1) A short sale: if the sale goes through, the new buyer takes the home subject to any leases or tenancies. Of course, since you are a month-to-month tenant, you can be made to leave on a month's notice, since the new owner doesn't owe you anything more than  the old owner did, which in a month-to-month is only one month's notice.

2) If the home is taken over in a foreclsoure or given back in a bankruptcy, that immediately ends your tenancy.

3) The landlord can't shut off the utilities while you reside there. She may give you one month notice to leave, however.

4) In all events, you should get your security deposit back less anything you would owe for damage to the property or unpaid rent.


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