Are you a tenant in a property in foreclosure?  Here are some helpful answers.

Did the landlord have to tell me the house was in foreclosure? I was never told.

Unfortunately, there is no law or rule that requires a landlord to disclose that a property or unit is in foreclosure when it is rented to you as a tenant.  A landlord is still the legal owner of the property until the foreclosure sale is completed and title vested in the new owner; so at the time of renting the landlord had title and could rent out the property.  You can protect yourself by searching the county records in your county to see if the owner is in active foreclosure before signing a lease though; or retaining a lawyer to look for you (and review your lease for such a disclosure).

I’m a tenant in a property just went to sale, how long do I have?

Under the old laws, the Protecting Tenants at Foreclosure Act, upon the sale of the property at auction, the new owner had to honor the new lease to the end or for at least 90 days if there was no written lease; pending you were paying market rent.  But this Act expired December 31, 2015.

Under recent amendments to the Florida Statutes, Section 83.561, the new owner at foreclosure sale is required to sent a tenant legal notice that the tenant may have up to 30 days to move out, pending that the tenant prove a rental agreements and that he/she/they are not paying grossly under paying market rent.    You must also be a “bona fide” tenant paying market rent; not $500 monthly for a property that market rent is $1,500 monthly.

You may need to hire an attorney to prove to the new owner that you are a “bona fide” (real) tenant under this new Section though.  Contact Us today for your FREE consultation!! 754-900-1LAW (1529), info@HKLegalGroup.com or use our webchat to the bottom right of your screen (open almost 24/7!)

83.561 Termination of rental agreement upon foreclosure.—

(1) If a tenant is occupying residential premises that are the subject of a foreclosure sale, upon issuance of a certificate of title following the sale, the purchaser named in the certificate of title takes title to the residential premises subject to the rights of the tenant under this section.

(a) The tenant may remain in possession of the premises for 30 days following the date of the purchaser’s delivery of a written 30-day notice of termination.

(b) The tenant is entitled to the protections of s. 83.67.

(c) The 30-day notice of termination must be in substantially the following form:

NOTICE TO TENANT OF TERMINATION

You are hereby notified that your rental agreement is terminated on the date of delivery of this notice, that your occupancy is terminated 30 days following the date of the delivery of this notice, and that I demand possession of the premises on …(date)…. If you do not vacate the premises by that date, I will ask the court for an order allowing me to remove you and your belongings from the premises. You are obligated to pay rent during the 30-day period for any amount that might accrue during that period. Your rent must be delivered to …(landlord’s name and address)….

(d) The 30-day notice of termination shall be delivered in the same manner as provided in s. 83.56(4).

(2) The purchaser at the foreclosure sale may apply to the court for a writ of possession based upon a sworn affidavit that the 30-day notice of termination was delivered to the tenant and the tenant has failed to vacate the premises at the conclusion of the 30-day period. If the court awards a writ of possession, the writ must be served on the tenant. The writ of possession shall be governed by s. 83.62.

(3) This section does not apply if:

(a) The tenant is the mortgagor in the subject foreclosure or is the child, spouse, or parent of the mortgagor in the subject foreclosure.

(b) The tenant’s rental agreement is not the result of an arm’s length transaction.

(c) The tenant’s rental agreement allows the tenant to pay rent that is substantially less than the fair market rent for the premises, unless the rent is reduced or subsidized due to a federal, state, or local subsidy.

(4) A purchaser at a foreclosure sale of a residential premises occupied by a tenant does not assume the obligations of a landlord, except as provided in paragraph (1)(b), unless or until the purchaser assumes an existing rental agreement with the tenant that has not ended or enters into a new rental
agreement with the tenant.