Is your landlord in foreclosure?
A growing problem among people who rent their homes is that their landlord is allowing their home to go into foreclosure, but is not telling the tenants about it. What happens if your landlord goes into foreclosure? Should you keep making your rental payments? If the bank forecloses, will it kick you out?
Although the laws are different for each state, here in Arizona, it appears that you might have at least some protection. According to a story that ran in the AZCentral.com not too long ago, you do have certain rights. Valley Real Estate attorney Christopher Combs, says that in the event that your landlord goes into foreclosure and you still have a period of time left on your lease:
Under a new federal law that took effect May 20, the bank generally would have to honor the lease of bona-fide tenants.
One of the exceptions to the new law is that if the bank sells the home to a buyer who will use the home as a primary residence, the bank can then furnish a 90-day notice of eviction to the tenants.
In regard to your liability as the landlord, if your tenants are evicted, you can be held liable for your tenants’ monetary damages, such as higher rent and moving expenses, due to the early termination of their lease.
What is the best way to know if your landlord is in foreclosure? If you just want to check once if your landlord is in foreclosure, you can easily check the county records – in the foreclosure process, a Notice of Default must be filed and is a recorded document. Here is also a site ( Rentalforeclosure.com) that you can check to see if your landlord is in default ( although according to at least one source, this site may not always be accurate).
And if you are concerned about monitoring whether your landlord is in foreclosure, there is a new service available from Lemonlandlord.com where it will monitor whether your landlord goes into foreclosure for something like $3/month.
Is it worth a few dollars a month to keep an eye on whether or not your landlord is in foreclosure?
Seems to make cents to me.