What Happens if Your Landlord is Foreclosed On?
The bad economy and possibly bad business decisions have put some landlords at the center of the foreclosure crisis.
Besides being evicted, tenants can lose months of rent and their security deposits. They can lose their good credit scores if banks mistakenly list them as defendants in foreclosure cases. It's a tough situation.
What happens if your landlord is foreclosed on? What can you do? Plenty.
When Your Landlord is Foreclosed On
- - Ask your landlord to end the lease early so you can move out.
- - Give reasonable notice.
- - Give your landlord contact information so your security deposit can be sent to you.
- - Put any agreements in writing.
- - If you receive a notice that your landlord is facing foreclosure of your rental property, contact an attorney who specializes in landlord/tenant matters. Also contact an attorney if you have received court papers or are concerned about your legal rights, have a complaint about your landlord, need advice about recovering a security deposit, or have any other related questions.
- - If you have to move out before your lease expires, you may be able to sue your landlord for monetary damages, although it may be difficult to collect from someone in foreclosure.
- - Try to recover your security deposit once you move out if the landlord doesn't return it.
- - If the bank or new owners contact you, negotiate a date to move out.
- - You may be offered "cash for keys" by the new owner if you leave voluntarily without going to court.
- Don't pay rent to the new owner unless you have a written agreement on your right to remain on the property.
- - If you can't reach an agreement with the new owner, only a court can order you to vacate. The new owner doesn't have the right to change your locks or force you to leave without a court order.
Aaron Crowe has lived in at least five rentals in the San Francisco Bay Area. Reach him at AaronCrowe.net