What are my options for preventing loss of my security depositif renting a condo that is in foreclosure?
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What are my options for preventing loss of my security depositif renting a condo that is in foreclosure?
The owner has not paid mortgage in several months and the condo is set for public auction 1 month from today. I’d like to prevent loss of security deposit, since taking the previous owner to court will probably not result in full reimbursement of my security deposit. The owner has not put the security deposit in a separate account, so I believe I am entitled to the full amount, on top of the fact that there is no damage to the condo whatsoever. Can I withhold rent/stop payment on rent checks? Can I simply move out early?
Asked on February 14, 2012 under Real Estate Law, Tennessee
Answers:
Glenn M. Lyon, Esq. / MacGregor Lyon, LLC.
Answered 11 years ago | Contributor
Neither. Until the foreclosure actually happens, you are required to perform normally under the lease.
Regarding the separate account, if the landlord owns ten or more units, they would be required to keep the deposit in a separate account. However, you will have to wait and see what happens to your deposit before taking action on this point makes sense.
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