How to Protect Your Lease from Foreclosure
UPDATED: July 31, 2013
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If you have rented a home and signed a lease in good faith with a landlord, you are protected under the law in the event that the landlord has financial problems and ends up facing foreclosure. The law ensures that you cannot just be kicked out of your home in the event of foreclosure if you have a lease in place.
Protections for Leaseholders in Foreclosure
Foreclosures, unfortunately, have become all too common. As a result of a wave of commercial and residential foreclosures in 2008 and 2009, the government took action and in 2009, the Protection of Tenants At Foreclosure Act was passed.
- This law gives you, as the tenant, the right to stay in the foreclosed property until the end of your lease, so you should be able to stay there for the full number of months that you have remaining.
- The law also provides protections for those who are on a month to month lease, giving these tenants an additional ninety days to vacate the home.
Because of this act, which allows for more time to stay in the home than the state laws on this issue may guarantee, tenants have time to look for another place to live and are not immediately kicked out of the property.
How to Protect Your Lease After Foreclosure
Thus, if you find yourself dealing with a foreclosure, you need to let the mortgage company know that you have a lease, are living there and are going to stay there. You should send a certified letter to the mortgage lender - ideally with a copy of your lease and other documentation - as soon as you find out about the foreclosure. Make sure you keep detailed records of this and all correspondence. You should also think about getting a lawyer to help you protect your rights and make sure you don't find yourself tossed out of your home as a result of your landlord's inability to manage his financial obligations.