26 answers

Our Landlord Is in foreclosure..need Advice!

So after our landlord first tried to sell our rental house, we received notice that he is in foreclosure! The house will be sold on 9/11/2009 if he does not "catch up" by 8/31. We had already discussed moving out early since he wanted to sell the house, only now he wants to keep collecting our rent, not paying the mortgage, and won't give us our deposit (almost two months rent) until we move. The problem is that we need the deposit back earlier in order to be able to afford a new rental deposit and moving expenses. Our previous two landlords sold their houses before our lease was up and not only gave us our deposits but didn't charge us rent for one-two months for the inconvenience of ending our lease early through no fault of ours!

I need either a lawyer who is cheap or will just give us advice on whether or not we have any recourse. We would be willing to discuss buying the house from the bank directly, but they won't talk to us without the landlord's authorization.

I already told him we can't move until we get the deposit to pay a new one, or that he can keep our deposits and not collect rent for two months in trade, but he did not agree and has not responded to me since. Some people have told me not to pay him rent but I don't want to end up evicted or without a rental reference. But will he really spend the money and time to evict us if he's looking at selling or losing the house anyway in two months time? If we just stay in the house until they sell it, how much time will we have to move, and will the bank be entitled to our deposit then? Our lease is up 19 days after the auction date.

Any ideas? I feel like we're getting cheated and that we will end up homeless if we don't get that deposit so we can get a new rental!

Thanks!

3 moms found this helpful

What can I do next?

Featured Answers

Contact the Oregon State Bar Lawyer Referral Service at ###-###-#### or toll-free in Oregon at 800-452-7636. You may also qualify for the "Modest Means Program", please mention this when you call asking for someone to specialize in Landlord/Tenant law. Good luck!

Hi T J,

I suggest seeking out legal aid through family services (aka welfare office), for advice on who to contact....because every state has different rules.

ALSO, I would take extensive photos that are timed and dated, to prove the condition of the home when you moved out. Landlords have been known to stage damage to homes to their advantage. (i.e. broken windows, clog plumbing, damage appliances, holes in drywall... etc)

good luck,
C. M Hamlin

I would not pay any more rent he will have to pay to evict you. So you are likely in the clear for the time you have left. This is just my take on theings no a lawyer. Good luck!!

More Answers

Hi TJ,

I saw your post last night. My husband worked for a law firm that handles landlord/tenant law (on the landlord side of things) for 3+ years and now works for another firm that handles foreclosures (on the lienholder side) I thought that he might be able to shed some light on your situation from an attorney's point of view. I forwarded your post to him and here is his response, hope this helps:

'She can’t get her deposit or rent back right now since the landlord is not in breach of the landlord/tenant agreement. He is breaching his loan obligation, but that’s between him and his bank. There is no landlord/tenant law right that the property won’t go into foreclosure, just that the landlord can give her possession during the lease term, which he is. Even if it sells at the sale (19 days before lease end date) that’s ok in this situation, because the person in possession has 20 days to vacate after a sale. Given the 9/11 sale date, the bank probably timed the sale for that reason. If the occupant does not vacate within 20 days following the sale, then they are subject to eviction. She needs to pay her rent because the landlord can evict her if she doesn’t. If she moves out early the landlord can likely apply her deposit to the lease break damages (I’d need to review the lease to say for sure), so she should stay for the full term.

The bottom line is that all she has bargained for is the right to possess the property for a term in exchange for timely payment of rent. Regardless of what happens regarding foreclosure, or what the landlord does with her money, none of her rights as tenant are affected by this process. She isn’t entitled to an early refund of the deposit. She couldn’t ask for that early anyway and foreclosure has no effect on that. However, if the landlord doesn’t return her security deposit balance with an accounting within 14 days of moving out, then she can sue and get her deposit plus attorneys fees, and plus possibility double the deposit as damages.

She should ask the landlord for a signed release allowing her to talk to his bank.

She can attend the sale and bid for the property, but she’d need to payoff the foreclosing lien holder’s and any superior lien holder(s) interest(s) in the property, and at that point the property may not be worth enough for that to make sense. And she’d need cashier’s checks to cover 100% of the foreclosure sale purchase.'

Finally, I would encourage her to call the WA attorney general’s office to see if they have other resources for the tenant. I’m looking at this as a landlord’s attorney, and since foreclosures are a growing problem now maybe the attorney general has something in place to deal with this that I’m not aware of.

5 moms found this helpful

Do not pay him any more rent. If he chooses to evict you, it has to be seen before a judge before the eviction will be finalized. You will be able to tell the judge why you are withholding rent, and the judge will not finalize the eviction due to the foreclosure and non-refund of deposits. The judge will give you an adequate amount of time to leave the property if you request it. It takes about three months for the whole eviction process to get to the court phase anyways, so I doubt your landlord is going to have any leeway to do so since he will not be the property owner in two months.

Make all future contact with him in writing. Request what his plans are concerning your deposit. State in your letters to him what he said about not giving you your deposit back, and your concern for that. Ask for his response in writing. Make copies of what you send him, and send it by certified mail(keep the receipt), and also by email if possible. Do not speak to him about the subject in person any longer. I cannot stress enough how much it matters to have your communication with him be in writing from now on.

Here is how the eviction process works:

1.Landlord must in writing, give you either a 30 days notice, or a 72 hour quit notice for non-payment of rent.

2. You ignore the written notice and stay there.

3. Landlord must file with the court a legal eviction proceeding, and have the county sheriff hand-deliver it to you. What the sheriff will give you is a paper that states when your court date is. The court date can be anywhere from two weeks to two months later, depending on how busy the court is. You still get to remain at the residence.

3. Court. You go before a judge with the landlord and present your case. You explain why you are withholding rent and when you think you will moved from the premises. Usually, you will be granted the time to leave, with the stipulation that if you are still there by your move out date, the landlord can then have the eviction finalized. If you are out by the agreed upon date that you gave the judge in court, there will be no eviction on your record because it was not finalized. Finalizing the eviction requires refiling with the court, and upon refiling the sheriff will come to the property in 30 days to physically remove you. If the sheriff comes out and you are not there to physically remove, the eviction will not hold on your record.

Your landlord sounds awful. I am battling my landlord too, that is why I am so savvy to the rental laws right now. I don't think your landlord would make a good rental reference, hearing his practices on your deposit. You would be better off using me for a rental reference:)

http://www.washingtonlawhelp.org/WA/index.cfm
(Washington Law Help-Helping Low-income People Find Solutions to Civil Legal Problems)

http://www.lawhelp.org/documents/4306116122EN.pdf?stateab...
(link to the following pdf)
New Protections for Tenants Whose Landlords Go Through Foreclosure
On May 20, 2009, President Obama signed a new law providing additional protections for tenants living in properties that have been foreclosed. This law is effective now.
If you’re a tenant and your landlord went through foreclosure, be aware: Under the new law, anyone who purchases the property after foreclosure must provide you with the following:
• 90 days notice prior to eviction; or,
• if you have a lease, the right to stay until the end of your lease term, unless the purchaser sells the property to someone else who will use the property as their residence.
This law does NOT apply to you if you’re the mortgagor or a member of the mortgagor’s family, or if your tenancy is subsidized.
If you have a Section 8 voucher and your rental was foreclosed, anyone who purchases the property can’t evict you unless the purchaser plans to use the rental for their residence and has given you 90 days’ notice. Otherwise, the purchaser becomes your new landlord fur the duration of your lease term.
This publication provides general information concerning your rights and responsibilities. It is not intended as a substitute for specific legal advice. This information is current as of the date of its printing, June 2009.
(Permission for copying and distribution granted to the Alliance for Equal Justice and to
individuals for non-commercial purposes only)

Hope this helps:) Good luck!

3 moms found this helpful

The bank won't talk to you but if it is in foreclosure then a real estate agent should be able to talk to the bank in lieu of you or wait until it goes on the market and put a bid in then. You might consider making a deal with the real estate agent also because they are hurting so you might be able to get their fee down.

N.
SAH Wife, Mom, Grandma

1 mom found this helpful

If you are interested in buying the home from the bank - I would get a hold of a lender/mortgage banker or even the bank that is holding the deed of the property and find out what you would "qualify" for in a loan. Get that process started so you know what you can afford and all that good stuff. Get a hold of either the realtor that was originally listed through or another realtor and tell them what is going on. I don't know what the rates are in WA, but here in OR basically when I was a realtor (in-active now) I would list a property for for 5% or 6%....hence I would be splitting it with the selling agent who would bring in the buyer. But what you need is someone who can handle all of the legal documents and escrow and appointments for inspections, repairs, appraisals and such. You could handle it all alone - but it's nice to have the emotional roller-coaster left on the realtor's shoulders. But in this instance you already have the property you would like to buy give the agent a cut rate (I know that I might make some other agents mad, but you have to do what is right for your client at the time). I had an estate deal that was with an attorney - I was just representing the buyers end - I did it for like $1500 or $2000 - I don't remember the exact amount. Half of the footwork was already done. Anyway - I'm rambling....if you are serious about buying this particular property - first things first you need to find out if you qualify for purchasing the property. Just be careful - a lot of times people don't realize that sometimes there are back taxes owed, other lein-holders or a 2nd mortgage on the property.

As for legal advice - I would make sure that the attorney has experience in real estate law. That is very important - real estate law can be tricky. And if I remember correctly - there is some scuttle-butt about landlords forclosing on properties and leaving the tenants high and dry - so, I think you have some kind of protection. That isn't right - you are a good tenant and the landlord is just taking the money and not paying for his investment. I'm sorry - it's not a great time in the economic world. I have faith that it will get better sooner than later. Good luck. I hope that I helped.

1 mom found this helpful

TJ

If you are in the state of WA, we have a new law in place protecting people in your situation. You don't need a lawyer first. There is a state sponsored non-profit helping people like you and I believe it's through Department of Finance. If not, they can direct you. Don't pay anyone for anything - there are TONS of scammers out there. You need to be very careful to protect yourself and only those qualified to give advise should. Remember, don't pay for advise unless you are directed to an attorney from the Department of Financial Institutions.

Good Luck.

1 mom found this helpful

I used to manage apartments before I had my daughter, so I can tell you from the landlord side of the fence.

He is being dishonest & unreasonable & you have to watch out for yourself & your family. If he decides to take you to court you have reason on your side. Keep all documentation & write all requests & keep copies. Do not pay him the rent or he will keep your deposit & the rent & you will be homeless. Open a new checking account & put the rent in it, nothing else, use this as your escrow account. Keep all the statements, if your go to court this will show the judge that you had the money & put it aside to pay the landlord. Put the second months rent in it show you would have paid it if he would have given you back your deposit. It's called being reasonable. If he is not being reasonable the judge will be on your side as long as you have kept documentation & been reasonable yourself. Keep a journel of conversations, what you said, what he said & time & dates when it was said. All futher comunication must be in writing & certified mail.

No, he won't take the time to evict you, it takes longer than two months. It will be O.K if you don't have him as a rental reference as long as you show the new landlord the forclosure notice & explain the problem with the old landlord & give your pervious land lords as references.

Follow Betty O's advise, stay until you are almost physically evited & save up all your money. Have a place ready to go to & have your stuff ready to go when it's time.

Don't bother trying to sue him, even if you win, the court will not enforce making him pay. You will have to do that yourself. Waste of court fees & your time & effort. No, the bank is not entitled to your deposit. Just know that this dishonest landlord will not be giving it back to you. If he does offer to give you back your deposit ask for it in cash. Since he has been dishonest so far, if he refuses & says it must be check, take the check & deposit it as soon as possible in the "escrow account". Banks have 30 days not 10 like everyone thinks to have final say on a check. They may clear it after 10 days & say it's good at first but on day 30 they can say it was bad & take the money from you out of your checking for this bad check. My parents work at banks, this is how I know.

If your landlord demands your rent when he gives you your deposit (if it's in check form) tell him that in 31 days after the check has cleared he will get it, tell him this after he has given you the check.

Look in the white pages of the telephoe book for your local Renters' Rights Hotline, call & leave a message, & keep calling. In Oregon the number is ###-###-####. If you can't find that call you local Police non emergency number & ask them for guidence on who to call. If they say they can't help call the Attorney Generals' office, they should be able to guide you on who to call. Make sure to keep a note book & pen by the phone & write down all the people you called & the numbers. Do not pay anyone a cent. you should be able to get all you need free.

He sounds very devious, I would go to home Depot/Lowes/ Ace Hardware & get all new deadbolts, they are relativly cheap & easy to install.

Call me if you want futher help.
###-###-####
H.

1 mom found this helpful

Depending on where you live, there may be great resources for free in your community. For example, in Bellingham there is an organization called The Opportunity Council, and they have employees who can talk you through the Landlord Tenant Act and help you to understand what your rights are. You may also be able to obtain a copy of the Landlord Tenant Act online or from the Library so you know what your rights are. Also in Bellingham, there is an organization called Law on the Streets, which offers free legal advice to people every Saturday during the summertime and twice a month in the winter time. They are coordinated through the library, so you can call them for more information. If you don't live in Bellingham, you could talk to the courthouse clerk where you live and find out if there is any free or low cost legal organization in your town. Definitely getting, reading, and highlighting a copy of the Landlord Tenant Act is a good place to start. If you let your landlord know that you have read and understand your rights, he may be more willing to cooperate with you.

Good luck!

L.

Hey there,

I suggest you Google: "Landlord Tenant Services, your state"

This will bring up something called the Landlord Tenant act in a lot of cases. You do have rights. There are organizations that can help you and Landlord Tenant services is one of them. They are very good about returning phone calls...leave a detailed message, with a summary of what's going on and they will get back to you with solutions. Good Luck!

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