Who do I pay my rent to ifmy landlord was foreclosed on?

UPDATED: Aug 17, 2011

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Who do I pay my rent to ifmy landlord was foreclosed on?

I am renting a house from a management comp; there is 11 months left on the lease. However, yesterday there was a notice of trustees sale taped to the house informing us the home was going up for public auction in about 3 months. So who do I pay my rent to? How long will I be able to stay here in this house? Lastly, when does the management company have to return our security deposits?

Asked on August 17, 2011 Arizona


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

Answered 11 years ago | Contributor

You have several issues here. First of all, you still pay your rent to the landlord (i.e. management company) until the title to the property transfers to a new owner (after the auction). First of all, until legal title to the property passes, your landlord is still the owner. Therefore you must continue to pay rent to him (whether or not he is paying his mortgage). As the lawful occupant of a property in foreclosure, you should be notified by the mortgage lender as to the official transfer date of the property. After this time, the landlord will no longer be the legal owner. You will then be informed where to send your rental payments.

Regarding the return of your security deposit, unfortunately there may not be much that you can do about this. Although technically the landlord (or management company) is supposed to return it to you, in a case such as this they may no longer even have the money. While it is illegal, it is also reality. Typically, a tenant’s only legal recourse in a foreclosure situation is to sue the landlord in small claims court for their deposit, plus interest. And, even though you may be win in court, actually getting the money that you are owed may be much more difficult given the owner's finances.

As to just how much longer you can stay, under federal law tenants who have a written lease can continue to occupy the residence until the end of their lease, or 90, whichever is longer; unless the new owner wants to live there in which case a 90 day notice to move would apply. Additionally, some state laws give even more protection.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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