Purchased foreclosure, tenant won't leave

[thewraith]

I have recently purchased a foreclosure property in Arlington VA. I want to occupy the property as my personal dwelling. The new law says that I must give the tenant 90 days notice before eviction. The tenant has a lawyer that is saying I must let the tenant stay the remainder of the previous lease. There is a catch here. The area that she is living in- the rent should be approximately $3000/month. The previous lease that she had (which seems like it's totally made up) says that she paid approximately $20,000 for the first four months then $3500 for the next 1 and now for the remaining 7 months of the lease- she pays $1200/month which is WAY under the market value of this area.

What are my options? What can I do? I realize that I may have to let her live there for 90 days. I have not received any rent for 20 days, and that contract makes no sense to me as I'll be losing almost $1500/month with that rental agreement she claims to have had. I want to add that her lawyer keeps asking me to "challenge" him and do something about it. Can anyone please help?

[thewraith]

May I also add that I'm almost 100% sure that she is/was friends with the former owner of the property. I do NOT have proof of this. She has no contract with me, do I have to honor the former contract?

payment of the rent, whatever it is, is still required. if they are not paying the rent you should be able to evict for nonpayment. i hope the tenant and their lease was disclosed to you before you purchased.

[thewraith]

I purchased it at a foreclosure auction- there was no word of a tenant. I have sent them registered mail telling them I am evicting them. My main question is this:

Am I bound by the terms of the original ,bogus-looking rental agreement? Do I have to accept $1200/month as rent for a place that is worth at least $3k/month?

My family has been in the foreclosure purchase business for a while- but with this new tenant protection law, I'm totally confused as to what my options are.

You normally do not have to accept that...they likely leased subject to the mortgage and they can be evicted--and if you show they are lying about the lease you can seek other damages if need be.

Check state laws since tenants' rights under foreclosed properties change daily. Some states make a buyer give longer notice to vacate, others say the lease must stand. (Many states say foreclosure ends the lease.) Check with a local eviction attorney if you do not know the laws on this there.

But if the tenant has not paid the rent her own lease says she must, issue the 5 day pay or quit notice and start to evict. She must pay for that 90 days. ***I strongly suggest seeing a local flat rate eviction attorney since she already has one.

[thewraith]

Thank you everyone for your replies. I will seek an eviction attorney. One more question before I do this:

If the former owner knew the house was being foreclosed on (which it seems she did) and was already behind on payments. Can I subpoena the former owner and then if that is the case- is the former contract void? NOTE: There is NO contract between the tenant and I.

thanks again

A lease does not become invalid simply because the mortgage payments are in arrears. Until the house is in the possession of the bank or a new owner, he has rights as the owner. One of those rights include being able to lease the property. So he legally could sign the lease.

The question is does that lease transfer to the new owner after a foreclosure sale? Normal real estate sales and short sales of property include the transfer of a lease. A new owner under these circumstances must honor the currrent lease that is in place. But until recently, almost all states held that foreclosure invalidates any lease in place on that property. Since so many states have had such high foreclosure rates, and since this affected so many tenants, some states have now put in protections for tenants who find themselves in a lease on a foreclosed property. These protections range from a period with no rent due, an extended period to move out, and in a few states, extension of the new owner's responsibility to honor an existing lease. If you have researched the foreclosure laws in VA and found that it included this extended move out period (90-days instead of 30) and that it does not include a transfer of lease responsibilities, you should be in the clear.

Please seek the advice of an *eviction* attorney and not a real estate attorney. The former specializes in evictions only and is very knowledgeable in those laws specifically. The latter does work on titles, deeds, sales contracts, and ocassionally evictions. Their knowledge is not specifically on eviction, but a broad knowledge of real esate law. YOu want the eviction specialist. He will know the new law very well. If you do not know who to call, stop in the court on evictions day and see who represents their clients well in court or seek a referral from a local LL group or a local chapter of REIA. Good luck.