Foreclosure on rental, what's a tenant to do?

[Jychf]

We are renting a house and have been for about two years. Never signed a second lease after the first year was up. House is now being foreclosed upon and we don't know what our options are. You hear so many different things from different people. Does anyone have any experience with this situation? Any input would be greatly appreciated!! We don't know how far along the foreclosure is and definitely would like to stay in the house. We're working with a mortgage broker to get qualified as quickly as we can but don't know if the landlord has the right to evict us or if we can "wait it out" for the bank to take over................

Thanks,

J

[Smiling JOe]

I am not an attorney. If you have any questions, seek legal advice from a qualified attorney. From my common knowledge it sounds like you have a month-to-month agreement, even though it is not in writing. That means, either you or the landlord can give the other party a 30 day notice to end the lease. If the landlord gives you a lease, and you choose to not comply, the only way they can legally remove you is through the eviction process, which can take up to a year. They cannot legally come by and put new locks on the door, preventing you entry, but I have heard many stories, and one story where all of the contents of the house were placed on the curb. (Judge ruled in favor of the tenant.)

If you suspect your landlord isn't being upfront with you about the foreclosure, you can contact the Clerk of Courts to find out the status of the case. I understand that it takes about one year for the foreclosure to happen, beginning with the first failure to pay. The other question you need to know is whom to pay, so you want to know who the owner is. The new owner may also want to keep you as a tenant, so you never know, until you ask. If that is too stressful to deal with, you might want to seek a new place to rent.

Again, for legal advice, seek a lawyer. I am not a lawyer.

[Jychf]

Thanks JOe, I appreciate your advice. The situation is a very stick one, we have spoken at length with the owners, they're even trying to find us a place to move. I suspect that they want to live here during the foreclosure (no mortgage to pay) until it is finalized. I am in the process of trying to find a new rental, problem is we really like this house and don't want to move.....

thanks again.

[bluemtnrunner]

We were in a similar situation but we did have a lease, we were told that the new owners would have to honor the lease or buy us out (I don' t know what that means really). We loved the house we were in but decided that we did not like living in limbo, waiting for the other shoe to drop. Our landlords hooked us up with another homeowner and based on our rep with the original landlord, we were able to get into the house we rent now. We have the same type of lease here where if the house is sold, the new owners have to honor the lease or buy us out of it.

We also decided to move so that we wouldn't have to be looking for a rental at this time of year when there are fewer available. We were very upfront with our landlord and with the new one as well so we could all work together for the best situation for all of us.
Start looking while you have some time to be selective, get the word out about what you are looking for and be choosy.
You will find something great, I'm sure.

[Smiling JOe]

One other thing to remember is your security deposit, if you have one. You might try negotiating it back from the present owner, if you have been a good, responsible tenant. I've heard of one recent similar case where the tenant worked with the landlord, dividing the security deposit into thirds, and deducting one-third off of each months rent for the next three months. You really need to be in good standing with your landlord for something like that to be worked out.

[Jychf]

we are actually living out our security deposit, puts us living here until the 10th of June. We have been very good tenants, the house is in better shape now then when we rented it...one reason we really don't want to leave this house!! We had no plans to leave anytime soon, planted a nice garden and everything. I certainly appreciate everyone's help, hopefully we can qualify for the right amount, it'll go into full foreclosure and we can make a reasonable offer for the house!!

[30ashopper]

Walton lists future foreclosure auctions on their site. The records are a bit tedeous to go through, but with any luck you'll find your house and know a bit more about what's going on. If it isn't in any of these records, the foreclosure sale is a long way off. You can confirm this by going down there and talking with the clerk in person.

http://clerkofcourts.co.walton.fl.us/default.aspx?id=31

(To view the full docs of a record, click on setting in the upper right, and change the viewer type to 'PDF'.)

[Jychf]

Thanks for the link!! Should've thought of that one I guess, just never occured to me. The case number is not on the active list so I'm guessing that it's not as far along as I would've liked it to be. No worries, I think we've finally decided to just find another place to live. Maybe we'll be able to put in a bid once it does reach foreclosure. Thanks to all for the advice and help.

[scooterbug44]

When you sign a lease on the next place, you should check/change the details so you have a little more warning next time. The standard lease form allows you to set a minimum notification time even after the original lease period passes and it goes to month to month.

[SHELLY]

When you sign a lease on the next place, you should check/change the details so you have a little more warning next time. The standard lease form allows you to set a minimum notification time even after the original lease period passes and it goes to month to month.

You might also want to check the property appraiser's site to see if your new place was purchased during the "Investulator's Era;" also check out how many properties the owner is on the hook for as well. More likely than not it will be a bubble house, because of the sheer number of properties that changed hands during that time that the owners can't dump at the price they've paid; but if it was purchased before 2004, and the owner didn't buy up a bunch of overpriced lots and condos since, you might have a better chance of staying put.

Also check the Tax Collector's site to see if the landlord paid their property taxes for this year or was delinquent in the past--non-payment could indicate they're having a bit of a cashflow problem.

Moreover, check the county records to see if the owner HELOC'd the property to kingdom come...another indication of cashflow problems.


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[rapunzel]

Moreover, check the county records to see if the owner HELOC'd the property to kingdom come...another indication of cashflow problems.


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I know how to check the WaltonPA site, but have yet to figure out how to check the above. Anyone have a link?

As for you Jychf -- we are in the same boat. We were actually served with foreclosure papers, too. We answered the foreclosure within 20 days (basically just a copy of our lease and contact info so the banks' lawyers would keep us in the loop and we would have some notice) but the papers weren't even filed for 90 days.

What I've learned in the process of all this is that the banks are dragging this process out. When it does finally reach the point of auction, the banks simply show up and bid the amount of the loan, take the house back, winterize it, and leave it sitting empty.

Until the foreclosure goes through, your landlord is still the owner, regardless of whether or not he's made a payment for over a year. Your lease is still enforced. Be grateful that at least you are going month to month at this point, and you aren't obligated to pay rent or buy out your lease in order to get out of limbo.

Of course, until these houses are actually sold at auction, the whole community is in limbo.

[Jychf]

Thanks!! Sorry to hear you're in the same boat rapunzel....seems a lot of people are going through the same thing lately. If we're moving out any way, are we required to even reply to the court? I would think that it's pointless considering whatever happens really doesn't matter if we're not here. Apparently, our landlords are dealing with multiple properties in foreclosure, we're the only tenants though. It's all been a real headache, one I won't mind ridding myself of shortly.

[30ashopper]

"Moreover, check the county records to see if the owner HELOC'd the property to kingdom come...another indication of cashflow problems."

I'm curious about this as well, would it show up as a lien on the property maybe? What site?

[Mango]

"Moreover, check the county records to see if the owner HELOC'd the property to kingdom come...another indication of cashflow problems."

I'm curious about this as well, would it show up as a lien on the property maybe? What site?

The same site you posted above. http://clerkofcourts.co.walton.fl.us/default.aspx?id=31

The document should say Home Equity Line of Credit on it. Most of the Lenders used the same FNMA instruments when recording their mortgages.

This brings you right to the Public Records section. http://clerkofcourts.co.walton.fl.us/default.aspx?id=7
Pan down and click on the Oncore records. Follow instructions from there.

[30ashopper]

Oh man, you can see what kinds of loans they took out.

Sale Price: 970K
Lender: Countrywide
Loan A: 650K PayOption ARM @ intro rate of 2.15%
Loan B: 250K HELOC, adjustible rate
Current est. value based on comps: 480K

It's like swimming around in the bowels of the housing crisis. I feel dirty. I need a shower, and a drink.

[30ashopper]

My goodness, what were these people thinking.

[SHELLY]

Oh man, you can see what kinds of loans they took out.

Sale Price: 970K
Lender: Countrywide
Loan A: 650K PayOption ARM @ intro rate of 2.15%
Loan B: 250K HELOC, adjustible rate
Current est. value based on comps: 480K

It's like swimming around in the bowels of the housing crisis. I feel dirty. I need a shower, and a drink.

Swimming in the bowels sure beats the heck out of having your arse kicked to the curb...now you know what to look for and where to find it, good luck finding a new place.

.

[SHELLY]

My goodness, what were these people thinking.

...they were thinking, "Now is a great time to buy--and flip. They're not making any more land! The Baby Boomers are coming! Real Estate never goes down, never! EVER! I'm gonna be rich....RICH I TELL YOU!"

.

[JOE who]

Jychf,
I'm also going through similar situation, except mine is further along. I (the renter with no lease) was served papers and was told "not to worry about it, most of these things get sorted out, just keep paying your landlord" so that's exactly what I did.

After a few unreturned phone calls to my landloard I decided to rid myself of the entire situation and move. Since I was on a "month to month" lease I figured it'd be no problem, unfortunately i couldn't get in touch with my landlord and his P.O. Box wasn't valid. So i moved without his knowledge. But that's not what got to me.

After awhile I sarted receiving notices via the banks lawyer with my name listed as a defendant along side my landlord. I called the bank and their lawyer to explain that I WAS a previous tenant, but no longer reside at the foreclosed property; and could i get my named remove from the foreclosure. That didn't help, the lawyers office never returned my calls and the bank said it wasn't possilbe for them to sue me since my name wasn' t on the mortgage. Now it's a year or so after being first served papers and my name is still on the defendant's list. The only advice i could get out of anyone I talked to is "Get a lawyer". Why, it's not my fault. I shouldn't have to pay a 1500 dollar retainer to defend myself for something I didn't do, pay a mortgage that I didn't sign/own/owe.


Sorry if there was no advice in the above ramblings... Sometimes I despise corperate America and their "I'm Too Big For You" attitude and the governments's "Liberty and Justice for All" (if you can pay for it).

Good Luck with your Situation...

[Mango]

Jychf,
I'm also going through similar situation, except mine is further along. I (the renter with no lease) was served papers and was told "not to worry about it, most of these things get sorted out, just keep paying your landlord" so that's exactly what I did.

After a few unreturned phone calls to my landloard I decided to rid myself of the entire situation and move. Since I was on a "month to month" lease I figured it'd be no problem, unfortunately i couldn't get in touch with my landlord and his P.O. Box wasn't valid. So i moved without his knowledge. But that's not what got to me.

After awhile I sarted receiving notices via the banks lawyer with my name listed as a defendant along side my landlord. I called the bank and their lawyer to explain that I WAS a previous tenant, but no longer reside at the foreclosed property; and could i get my named remove from the foreclosure. That didn't help, the lawyers office never returned my calls and the bank said it wasn't possilbe for them to sue me since my name wasn' t on the mortgage. Now it's a year or so after being first served papers and my name is still on the defendant's list. The only advice i could get out of anyone I talked to is "Get a lawyer". Why, it's not my fault. I shouldn't have to pay a 1500 dollar retainer to defend myself for something I didn't do, pay a mortgage that I didn't sign/own/owe.


Sorry if there was no advice in the above ramblings... Sometimes I despise corperate America and their "I'm Too Big For You" attitude and the governments's "Liberty and Justice for All" (if you can pay for it).

Good Luck with your Situation...

Blech! Sorry for your troubles. A simple clerical error hopefully is not damaging your credit? Have you checked your credit reports lately? If there is anything there, I would get print off copies of the deed and the mortgage off of the county records site, a copy of your lease (if you still have it) and forward it to the credit reporting agencies. They will remove it with documentation if erroneous info is showing up.

[30A Skunkape]

What Mango said. If it isn't on your credit report it doesn't matter in the grand scheme. Check your credit bureaus, and if there are any inaccurate public records dispute with the bureaus;they can't legally report inaccurate information, so if they don't fix it quickly start talking lawsuit and it will get fixed. You will want to do all this through certified mail.

[SHELLY]

What Mango said. If it isn't on your credit report it doesn't matter in the grand scheme. Check your credit bureaus, and if there are any inaccurate public records dispute with the bureaus;they can't legally report inaccurate information, so if they don't fix it quickly start talking lawsuit and it will get fixed. You will want to do all this through certified mail.

Geez Louise!...the crap that's coming out of this bubble just never ends!

If you find you have to go through the trouble of writing letters to the credit bureaus <because your credit got dinged> identify on your letter and send a copy to a couple of major newspapers/magazines (WSJ, Newsweek, NYTimes, etc)...they love writing about crap like this and maybe, when the reporters contact the agencies or the courts for background information, it might help move along getting your name removed from the documents.

.

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[TooFarTampa]

Geez Louise!...the crap that's coming out of this bubble just never ends!

This is so true. Just the other day one of my best friends was telling me about her sister in law, who apparently was one of those fraudulent mortgage brokers and will probably go to jail. My friend's MIL and aunt are going to lose their houses, the sister in law has no cash flow so she has allegedly resorted to selling coke. Looks like there were a lot of crimes of opportunity in the lenient lending market, and lots of people who shouldn't have been eligible to get duped were. You sure called it SHELLY ...

[JOE who]

Thanks for the advice Mango and Skunkape... I've checked my credit and so far i'm in the clear... However the foreclosure isn't complete yet, so should i check it after all is said and done???

Thanks again...

[Mango]

Thanks for the advice Mango and Skunkape... I've checked my credit and so far i'm in the clear... However the foreclosure isn't complete yet, so should i check it after all is said and done???

Thanks again...

You're welcome. It wouldn't hurt to sign up for one of those services that alerts you when inquiries or changes have been made to your credit, but, I think you should be fine relative to the foreclosure.

You can also hit the thumbs up thanks button on the helpful posts made on the rigth hand side. Skunky and I are being left in the dust by Smiling JOe.

[30A Skunkape]

Thanks for the advice Mango and Skunkape... I've checked my credit and so far i'm in the clear... However the foreclosure isn't complete yet, so should i check it after all is said and done???

Thanks again...

Oh, and hey, IF you want to make your landlord a wee bit uncomfortable while living up to your lease...

File a copy of your lease with the court as some sort of item associated with your landlord's foreclosure case. Then, compose a note that in essence says you plan to live up to your lease but are not too sure who should be getting rent money and you thus plan to give it to the clerk of court 'to hold on to'. File this as well. Then, take your rent money and give it to the court to hold. Not only is this perfectly legal it will at the very least force your landlord to drag themselves to the court to pick up the $$$, and who knows, they may choose to avoid the courthouse at all costs as they may have papers that need to be served on them and they might be trying to lay low. If it goes unclaimed you might be able to go back at some point in the future and recoup it as the property may have changed hands two or three times and a rightful recipient may be difficult to identify.

[JOE who]

Oh, and hey, IF you want to make your landlord a wee bit uncomfortable while living up to your lease...

File a copy of your lease with the court as some sort of item associated with your landlord's foreclosure case. Then, compose a note that in essence says you plan to live up to your lease but are not too sure who should be getting rent money and you thus plan to give it to the clerk of court 'to hold on to'. File this as well. Then, take your rent money and give it to the court to hold. Not only is this perfectly legal it will at the very least force your landlord to drag themselves to the court to pick up the $$$, and who knows, they may choose to avoid the courthouse at all costs as they may have papers that need to be served on them and they might be trying to lay low. If it goes unclaimed you might be able to go back at some point in the future and recoup it as the property may have changed hands two or three times and a rightful recipient may be difficult to identify.

That's great advice but the lease expired six months before the bank filed foreclosure papers, plus i've already moved out...

[30A Skunkape]

That's great advice but the lease expired six months before the bank filed foreclosure papers, plus i've already moved out...

Sorry. Well, I feel safe in predicting we will not be the last victims of this irritating situation and it might help the next guy.