Is a tenant entitled to free rent if the property that they rent is foreclosed on?

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Is a tenant entitled to free rent if the property that they rent is foreclosed on?

The rentl property that I own was foreclosed on. When the tenant found out last month that the condo would be foreclosed on this month, he asked if he could use his security deposit to pay this month’s rent, so I agreed. The sale took place on the 16th. The tenant is now requesting a refund of his “deposit” but he already used up his deposit by paying his last month’s rent. He has no deposit left. The deposit was refunded by letting him use it for rent. He demands that I prorate the rent for the month and give him back the amount for the period after the sale. Does he get free rent then if I do? The bank won’t collect rent until next month I believe. If anything, I owe the bank not the tenant. Am I correct that the tenant does not get a refund?

Asked on October 28, 2012 under Real Estate Law, California

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

From what you have written, if the tenant used his or her secuirty deposit to pay a month's rent as opposed to paying the rent directly then the tenant is not entitled to the security deposit since the property was foreclosed upon because such was used as rent.

However, under the laws of many states in this country the security deposit should not have been used as rent. A security deposit is a security deposit typically. If the tenant wishes to remain in the foreclosed unit he or she needs to remain current on rent.

 


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