My landlord hasn't made his mortgage payments

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Old Apr 15th, 2008, 04:51 PM   #1
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Angry My landlord hasn't made his mortgage payments

My husband and I are renters in California. We rent a home with our roommate who is also my best friend. We all sat down and signed a one year lease with the landlords, who are the parents of my best friend. Feb. this year (2008), our landlords came to the house to tell us that we needed to find another place to move because his house was going to go into foreclosure. He said, "It isn't into foreclosure yet, but it doesn't look as if I will be able to afford to keep this house, but, I'm going to do everything that I can to save it". That same day the landlord collected our $1600.00 rent payment between the three of us. In the month of March and April he still hasn't made the mortgage payment but still collecting rent money from us. The first week in March, he comes over to the house again to give us what calls a deal for us. He said, instead of collecting $800.00 a piece from us, he will just collect $500.00 a piece so that way the $300.00 we wouldn't be giving him will help us save to find a new place. So he states, starting April 1st, we just needed to give him $500.00. At this point...I'm thinking, if he has no intentions on paying the mortgage why should we pay him anything at all. Anyway, before the second week of March came around, my husband, roommate, and I found a new place to live. We were all set to move out of this house by the 5th of April...the latest. My roommate and I had drove over to her parents house (our landlords as well) to let them know that we had found another place to live. Our landlord (her dad) was happy to hear that.....UNTIL, we told him that we would be completely moved out by the 5th of April. We said April 5th, because the tenants were still in the house that we were planning on moving into, and the new landlord had told us that, that person wouldn't be out until the 3rd the lastest, and he wanted to use the last couple of days to do minor clean up, which would make us moving into that house on the 5th of April. Our landlord at this point started to get mad, because he said that if we are going to be move out, we needed to be out by the 1st of April not the 5th. He told me that if I moved out on the 5th he wasn't going to give me my half of the deposit back, but if I moved out before the 1st of April he would give it back. At this point I'm getting mad, because, first of all he came to us and told us that he couldn't make the house payment and to start looking for a new place to live and then we do just that and I get an agruement out of him instead. I asked him what did it matter what time of month we moved out, since he was going to let his house go into foreclosure......SHOCKED, he said because "I want to re-rent the house out, and you are obligated to give me my 30 day notice". So needless to say, we ended up not moving to that new home. Two weeks after this conversation happend our roommate tells us that she is moving out and moving to the other house on her parents property in another city. Her father (our landlord) moves her out on the 5th of April. That day he collected $500 from me and my husband. He tells us this day while moving out his daughter that he wanted my husband and I to stay in the house and to still give him $500.00 a month until the foreclosure notice comes because of the lease we have with him. Two days later April 8th, we got a letter that came to the door from the Mortgage Co. Immediately I drove the letter to the landlords house. They let me read it, and all it stated was that they haven't collected the mortgage payment yet. At this point my husband and I are so confused on what to do because we want to do right by our lease, but at the same time we feel as if we are getting robbed. We feel screwed by the landlord and the roommate. We don't know what to do about this, or if we even have the right to sue the both of them for breach of contract. This situation has been extremely exhausting as well as stressfull on us. If anyone can help with any information....I/we would apperciate it.

Last edited by ittybittyme; Apr 15th, 2008 at 08:29 PM.
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Old Apr 17th, 2008, 10:35 AM   #2
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Default Re: My landlord hasn't made his mortgage payments

First of all, you need to continue to pay your rent. The problem with your LL and his mortgage company is his business and is not yours. Whether he pays the mortgage or not, you owe rent for the place as long as your lease is in effect and he is the owner. He has the right to the money for the rent. What he does with it, well... You can't control that. Until you have notice that the house now belongs to the bank (not foreclosure has been filed, but foreclosure is *complete*) or that it has been sold at auction, you have to pay. Your lease is still valid and he can sue if you break it. Your lease has not been breached. You are paying rent and you still have the right to live there. Where's the breach? If you wish out, get him to sign a paper stating he is releasing you from your lease obligations.

IN the meantime, you get to stay in a $1600 unit for only $1000 a month. Save the remainder in a bank account so that you will be able to move when you get the notice. Foreclosure isn't a quick process and can take months to do. Once the bank takes it or it is sold, you should get 30 days notice to vacate. Some banks will even pay you a small amount to move out. Until then, continue to rent as normal.
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Old May 23rd, 2008, 10:32 PM   #3
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Unhappy Re: My landlord hasn't made his mortgage payments

From VA: How about if I received paperwork from the landlord's bank (who took the house in the foreclosure) to NOT PAY THE LANDLORD ANY MORE RENT? BUT...landlord has a $1500 security deposit and she's says that she owes us nothing...says we owe her...says shes keeping the deposit because she thinks we owe her late fees...we have been in this house for 2 years we originally signed a 2 year lease at $1500/mo and paid a $1500 deposit in April 2006. We were late a few times the first year but we paid the late fees as outlined in the lease agreement. Shortly after we moved in the washing machine broke...so she held the washing machine repair/replacement over us till she got all her late fees. In April 2007 she made us sign a new lease for $1700 a month (even thou 1st lease was for 2 years), because of our slow/lates the first year...at that time we had no choice but to stay (due to our credit) and sign the new lease (paid rent directly from my paycheck with allotment going to her). Also she bought a new washing machine in Mar or Apr 2007 which to use meant the late fees were settled. Then when Apr 2008 rolled around we asked about signing a new lease , she told us she was trying to find an investor and we could sign a new lease when she did. Some time in Apr a certified letter (from law office - foreclosure lawyer) came to "our" house for her we mailed it to her, next day letter from same place came in the regular mail. Then like a week later a letter from the same place came address to Occupent/Tenant so we opened it...it was about the pending foreclosure (to take place May 6). I called the law office and spoke with someone...to see what we need to do...basically this was just a courtesy copy. But then May 6, called again and found out the house did foreclose and go back to the bank. So we called the landlord...she still wanted Mays rent she was working with the bank. Week later was when we got the paperwork from the bank to to pay her any more rent...
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Old May 24th, 2008, 09:31 AM   #4
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Default Re: My landlord hasn't made his mortgage payments

Kedihe, your solution is simple. Call your county Auditor's office and ask who the owner of record is for your house. If the bank is now listed as the owner of the house, you should contact the bank itself, to see if they want you to move out or if they are willing to let you pay them rent while they are attempting to sell the house. (You would be required to move once they sold it. Your lease ends with the foreclosure and if the bank allows you to stay, it is only on a month to month basis.)

If the house is still listed to the landlord, you do need to pay rent to him as he still officially owns the house. It can take up to a month for the new deed to be recorded in the auditor's office. If it is still listed there as belonging to the landlord, you may want to call the bank and ask them why it hasn't been recorded. Let them know that your landlord is still listed as the owner of record for the house and he is demanding rent. They can handle it from there. Good luck.
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Old May 27th, 2008, 07:15 PM   #5
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Confused Re: My landlord hasn't made his mortgage payments

How about our deposit?
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Old Aug 12th, 2008, 10:15 PM   #6
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Default Re: My landlord hasn't made his mortgage payments

I love how all the landlords post that you must pay your rent regardless of the situation, of course they are going to say that. Shame on you! Renters who have active lease agreements absolutely must pay for the term of that agreement or until the home goes into receivership by the bank or new owner if they manage to short sell it.

However, if your original lease agreement has expired and you are living in a rental house on a month to month basis. You have no such obligation to your landlord for rent if he/she is about to be foreclosed on. I know this is anecdotal evidence but I am aware of several folks living in rental homes in California that were foreclosed on 6-7 months ago and are living there rent free because the lenders have such a tremendous burden right now, and in some cases can't afford to put the homes on the market (competing with all the other bank owned properties in the market right now) If this happens to be your situation you should RUN, not walk to the country or city clerks office and find out the following:

Is the home in default? (this is *the* most important first step)

Is it in pre-foreclosure?

Has a judgment been issued or an auction date been set for the property?


These are all very important questions and lastly, renters rights vary greatly depending on your state. *You should absolutely talk to an attorney* and do it as soon as possible. Play your cards right and you could do very well for yourself.

Good luck!
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Old Aug 13th, 2008, 03:06 PM   #7
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Default Re: My landlord hasn't made his mortgage payments

And you say shame on LLs! Shame on you. You just told tenants not to honor their agreements to pay the rent. Why do you think so many rentals are in foreclosure? Many of them are because the tenant doesn't pay!

This thread happens to be from one who has paid, and the house still was in foreclosure. But the owner's payments have nothing to do with paying for the rent. The rent secures a place for them to live for that period of time. They are living in the unit for that time. You advocate robbing the owner of his duly owed money for that.

As long as that house hasn't been sold yet at auction , you need to continue to pay rent to the owner. Many owners pull houses out of foreclosure at the last minute by refinancing. If you have failed to pay the rent, you are going to be evicted. Shame on you to put so many people in harm's way by advocating they take action to face eviction!
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Old Sep 23rd, 2008, 03:47 PM   #8
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Default Re: My landlord hasn't made his mortgage payments

I am in the same boat. We have been paying for months and the landlord hasn't paid in months. We haven't even been here for a year, they quit paying after we were here four months. The LL also has neglected repairs etc. because they are moving on.
I am angry and I want to save my money to put down on a new property. I don't want to sit here waiting for the bank to evict me and I don't have money for new deposits. So I completely understand where you are coming from. I don't want to move again. I shouldn't be punished for doing the right thing.
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Old Sep 25th, 2008, 08:22 AM   #9
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Default Re: My landlord hasn't made his mortgage payments

To the last poster:

You shouldn't be punished for doing the right thing. I completely agree. You do have options. First, make your repair requests in writing to the LL, sent by certified mail, rrr, and keep a copy. This makes a paper trail to prove the LL is neglecting his duties.

If he doesn't respond, you may have several options, including repair and deduct (making the repairs and taking the money out of his rent), rent withholding (depositing your rent with the clerk of court), or terminating your agreement. Please post your state for specifics on what you can do per your state law.

Unfortuantely, the LL is trashing his own credit. But you don't want to do the same thing. If you fail to pay the rent, he can sue you for the rent money. (Putting a judgement on your credit is one of the worst things you can do for your credit score.) Don't let his bad decisions become yours. If you follow the above steps, he won't get his rent money either. The court will keep it until he repairs. If he fails to repair, it could be refunded to you.

You will be notified well ahead of the sale if you notify the bank that you are tenants in that property. (Look at the county tax auditor's page for the name of the bank or call them.) You can also check the local court site for the lawsuit against the owner for the foreclosure. Let the bank know you are in there. They will notify you of the date of the sale. If the bank takes it back, they sometimes pay cash for keys to you to move out. Even if the house sells to another individual, they must give you the state required notice to vacate before they could file an eviction against you. This is usually at least 30 days notice to move. So you would have that month's rent to pay for a new place. Good luck.
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Old Oct 25th, 2008, 07:47 PM   #10
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Confused Re: My landlord hasn't made his mortgage payments

I am relieved to see that I am not the only one in this situation. My landlord went to visit relatives in June in Bolivia and has yet to come back. I send her my $1600 each month. But, I was told by her sister that she is six months behind in her mortgage payments and owes almost $16000 in past due payments.

I have heard nothing from her about foreclosure, but I am very nervous about how soon I should be looking to find a new place. Any ideas as to what I should be doing?

Nasha
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