If renters are living in a foreclosed home, what are their squatters rights?

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If renters are living in a foreclosed home, what are their squatters rights?

We are renters living in a foreclosed home. This has already gone to eviction, the names listed on the eviction notice were the landlord’s, Mr.Occupant, Mrs. Occupant. 2 gentlemen from the bank stopped by today to take pictures of the home and I explained the situation to them. They were unaware that we were not the mortgage holders. The gentlemen told me that it changes everything and that we may be able to exercise squatters rights and that could give us some additional time to find a place to live. We are actively looking for a place to live, but are yet to find one.

Asked on July 13, 2010 under Real Estate Law, Michigan

Answers:

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

Answered 10 years ago | Contributor

Federal law provides that a lender who takes possession of a property, or a new owner who buys the premises at auction, has to let a tenant stay for the longer of: 90 days from the sale or the remainder of their old lease.  If someone is buying the property to live in the rules differ a bit. In that case, they can terminate a lease with 90 days notice.

Also, sometimes the bank or new owner is anxious to get the tenant to leave sooner so the tenant can negotiate something that has become known as "cash for keys".  The way that this works is that you can agree to leave earlier than you legally have to if they give you money for doing so. 


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