33 answers

Renting a House That Is Being Foreclosed On

My oldest son is renting a house and he received a notice about the house being foreclosed on and put up for auction. The bank told him not to pay rent as the bank now owns the property. His landlord is hounding him for the rent and is threatening him and his roommates. Does anyone know his rights in this instance? If the house sells, how long do they have to find another place? I am grateful for any advice I can pass on to him....

What can I do next?

So What Happened?™

My son has been in negotiations with the bank who now does own the home. He is looking for another place so the situation has improved!
Thanks to everyone who offered advice, now we know our rights and won't be mislead!!
Mamasource clients are awesome!!

Featured Answers

Have him call the rent board or tenant rights board in his town. SF has one and they will explain his rights and tell him exactly what he should do in this situation-- all for free.

Rhonda,
When I was a teenager we were renting a house, we were served papers that it was being foreclosed, and we had to move, because the property manager said it was no longer his to rent. I would not give the money to the landlord, as he has not made a payment in over 3 months, or it would not be foreclosed on. Also, I would start right away looking for somewhere else to move to, and contact the bank and see what they can do to stop the landlord as well.
As it sounds like he is no longer the "landlord". I do know that there is a serious problem with the vacant homes being broken into, that might be why the bank told them to stay put.
W.

If the bank has it in writing that he is not to pay rent....
Then do NOT pay rent. If the landlord hassles him, call police with copy of bank letter in hand.

More Answers

Rhonda,
I work for a state Agency and here's what you should do...
The Deptartment of Consumer Affairs has an entire handbook on line that is called the Tenant/Landlord Handbook and can be found at http://www.dca.ca.gov/publications/landlordbook/index.sht... can also call Acorn Housing (a non-profit housing counseling resource) at ###-###-####.
Good luck and you're a great Mom to be looking out for your son...I'd do the same!!

2 moms found this helpful

go to www.caltenantlaw.com or just Google California Renter's rights - that's how I found it.
If your son meets income requirements he may be eligible to get help from Legal Aid for free as well. It may be worth a consultation fee to talk to a lawyer that specializes in real estate & tenant law in his area. The city of San Francisco has a free service for tenants because the laws there are so complicated - maybe there's something similar where your son is.

1 mom found this helpful

I used to intern at the Human Rights/Fair Housing Commission of the city and county of sacramento. That's an excellent resource for up to date info on situations like this. From my experience as an intern:

He needs to put his rent in something like an escrow account!

He needs to talk to his bank and open up a special separate account showing he was "paying rent" and also, if the landlord hounds him, to send the bank statement with the reference numbers of the rent amount deposits and a copy of the bank letter stating the situation. Every time he gets a notice from the bank or the landlord, he can respond with a show of good faith with the bank account, owed amount clearly delineated with on-time deposits, and the notice of foreclosure information determined by the lender.

If the landlord gets the house out of foreclosure, your son will owe all of that rent to the landlord or possibly to the lender.

Also, while it is not a guarantee, this may protect him from having to pay "late fees" or interest or any penalties outlined in his original lease agreement if this goes to court. No matter what, he needs to "pay his rent" even if he is paying it into a good faith account to show intention.

What he does with the money later after everything is cleared up, and if it is determined he does not need to actually pay it out to anyone, is up to him.

And in California, it's usually 30-60 days notice which the bank would have to give him as well, so he could have ample time to find a new housing option (I'd start looking asap.)

1 mom found this helpful

I would suggest talking to a real estate attorney or to a company that handles rentals. They would both know exactly where he stands on whether he should still be paying his rent or not.

How much time he'll have to move will be entirely dependent upon whether the new owners are buying for personal use or to rent out. If they are buying it as an income property he may not have to move at all. If they want to live in it. Well I'm not exactly sure in this case. I know for regular rentals you have to be given (or give) 30 days minimum to move out. Unless you get evicted, then once the order is signed by the court, it's generally 3-5 DAYS to get out.

I'd suggest looking around and trying to find something else RIGHT AWAY. I know moving stinks (I just did it after I got 30 days notice to move) but having a few weeks to get moved and all is MUCH better than a few days.

Again I'd talk to someone who specializes in real estate issues about all this. They will have more complete answers for you.

1 mom found this helpful

This is a sticky situation. He needs to move out as soon as possible. If the foreclosure is in process then the landlord still owns the house, however if the foreclosure has gone through then the landlord has no legal right to collect rent on the property that doesn't belong to him.
Either way your son needs to move. If the bank is auctioning the house your son needs to be out of there. I would suggest he not pay the rent and use that money toward a new home. Any homeowner will understand why he didn't pay rent and elected to move instead. He shouldn't count on getting any of his deposit back from the current landlord though.

Sounds as if the program is this.
1. Confirm that the house has been foreclosed. Apparently any realator can confirm immediately who is the legal owner of the house.
2. If the bank thing is just some craziness, and the landlord is still the owner, obviously pay him his rent.
3. If the bank owns the house they do not owe the previous owner anything. He probably owes them the deposit they paid, but it is unlikely they will get it. (Since, sleazelike, he has been trying to scam them for illegal payments called rent.)
4. There is NOTHING immoral about them staying in the property. Their leaving does not benefit the previous owner in any manner whatsoever. The current owner, the bank appears to have gien them permission - probably because they want the premises occupied, and so your son is performing a service.
5. They should consult with the bank about a time-frame here, and ask to be kept informed about potential sale. They should also inquire about any services the landlord paid previously.
5. They need to tell the landlord that the jig is up, and contact the police if he persists.
5. Since the owner, the bank, has specifically said not to pay rent, I don't see why they need to pay it into an escroe account. They should, however, get this arrangement on paper.
6. When/if the property sells, they should consult with the new owners about whether they need to move or not. At that point the 30 day information comes into play.

Rhonda,
When I was a teenager we were renting a house, we were served papers that it was being foreclosed, and we had to move, because the property manager said it was no longer his to rent. I would not give the money to the landlord, as he has not made a payment in over 3 months, or it would not be foreclosed on. Also, I would start right away looking for somewhere else to move to, and contact the bank and see what they can do to stop the landlord as well.
As it sounds like he is no longer the "landlord". I do know that there is a serious problem with the vacant homes being broken into, that might be why the bank told them to stay put.
W.

If the bank has it in writing that he is not to pay rent....
Then do NOT pay rent. If the landlord hassles him, call police with copy of bank letter in hand.

1 / 3
Required Fields

Our records show that we already have a Mamapedia or Mamasource account created for you under the email address you entered.

Please enter your Mamapedia or Mamasource password to continue signing in.

Required Fields

, you’re almost done...

Since this is the first time you are logging in to Mamapedia with Facebook Connect, please provide the following information so you can participate in the Mamapedia community.

As a member, you’ll receive optional email newsletters and community updates sent to you from Mamapedia, and your email address will never be shared with third parties.

By clicking "Continue to Mamapedia", I agree to the Mamapedia Terms & Conditions and Privacy Policy.