What to do if currently my wife and I are renting a home that has come up for forclosure?
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What to do if currently my wife and I are renting a home that has come up for forclosure?
It is set to be auctioned in just over a month. We at this point don’t believe the current landlord will own the property past this time. I believe she may have filed for bancruptcy. We are concerned about recovering our deposit from our current landlord. We know that our lease must be honored by whoever the new owner is due to some legislation passed a couple years ago. What approach is best to ensure our deposit is returned? After this next month of rent we lose what we consider our only barganing chip in the ability to withold rent as she may not own the house come next month. We however don’t take that option lightly as we feel obligated to pay our rent on time.
Asked on September 25, 2012 under Real Estate Law, Arizona
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
You are correct that under 2010 federal law so long as you are paying rent to the new owner of the foreclosed property, he or she has to honor the balance of your lease's term. If you are on a month-to-month lease, the new owner has to give you at least 90 days written notice that your lease is terminated.
Your bargaining power with the landlord who holds your deposit who will let the property go into foreclosure is to demand the deposit back now or you will not pay rent to him or her but rather will retain a landlord tenant attorney and deposit the rent into his or her client trust account.
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