Landlord in foreclosure

You seem very knowledgeable regarding the laws. Maybe you can help me.
I paid my rent of $2,000 on time for 2 years to my landlord. We started getting flyers in the mail saying savyour home from forclosure, which got us thinking, whats going on. Through our own research we found that the landlord hadn't been paying his mortgage and was starting foreclosure. We got this info 3rd week of April, I was due to have a baby the next week. We began looking for a new home, emailed the landlord saying we were aware of the foreclosure, it wasn't right/fair etc. Requested confirmation, of the foreclosure and said we wuld move as quickly as possible...we would try to get it done by the end of May, but with a new baby (i delevered later that night I sent the email) it could take a little longer. I asked if they would be so kind to allow us to keep May rent (as they weren't paying their mortgage anyway) and please return security deposit of $3,000---since there is NO DAMAGE and the house would be left the exact same way we got it, andlso because they were losingit to the bank anyway and therefore wouldn't be making any improvements to justify keeping the sec deposit. We got no reply from them. 3 weeks later we were served with a 3 day notice, it was over the holiday weekend..so we got extr days. On May 30th we were served with a smmns of unlawful detainer. We moved May 31st. I called their lawyer requesting t drop the case, and the lawyer thought they would...but it turned out the lawyer was unable to get hold of them. So, to cover my butt, I had to answer the unlawful detainer (it cost $360 to do so) and i guess now I just wait for a court date. None of his seems fair. They are defrauding the mortgage company, they defrauded us...and yet the laws are written to protect people like them? I will fight them in court and will go to small claims and sue to the fullest extent I can! I am out so much money with the cost of court the move, the searching for a new home the stress, worry and the time spent researching and not enjoying the special time with my new baby...I can't put a high enough pricetag on that! Do you are does anyone think I have a winnable case?

[OHlandlord]

I'm sorry but you do not have a winnable case. The LL did not defraud you. You contracted with him to provide a house for $XXX in rent. That is what you recieved. No one forced you to move out. No foreclosure had been completed. No court or bank had notified you that he no longer owned the property. There was nothing in your lease that said he would keep his credit intact. I don't know what you believe you could sue him for. He didn't make you move, that was your choice. You had to pay the court because you failed to pay your rent.

He was still the owner on record for the property. Until a foreclosure had been completed, he was still entitled to rent from you. What he did with that rent was his problem. If he wanted to skip his mortgage payments and ruin his credit, that was his choice and it had nothing to do with you until the bank either took the house back or it was sold at auction.

You lived in his property for the month of May. You do owe him for the rent for May. You may also owe him rent for a longer period depending on your agreement (I assume your lease had already ended and you were now a month to month tenant) or state law. This would be for a required longer period on notice (some states and agreements require a 60 day notice to vacate.) Or it could be for unpaid rent if you broke your lease by moving out. I'm sorry, but you did not handle this correctly.

If you wished to move, you needed to either negotiate a lease buyout, or give appropriate notice for m2m tenancy. You needed to pay the rent for that period. You needed to get a signed release from any lease. Then you needed to sue him for the deposit if he failed to return it. You are not permitted to use the deposit for rent in any state. This is why the court allowed a an eviction suit to proceed.

The deposit is, by law, to be used for any damages to the property. Since you cannot say what will happen in the future, you cannot be sure that the LL could not save the house from foreclosure at the last minute by refinancing or working out a deal with the bank (which is happening more often now that the government is pushing to stop all the foreclosures). In this case, the lease (if any) would have continued and so would your obligation for rent. You cannot simply stop paying rent because the LL doesn't pay his bills. Your obligations are separate from his.

I'm sorry. You should have negotiated your way out of any lease and gotten a release form. You should have paid for your last month. You could have just waited to see if the foreclosure went through. (You would have recieved a notice from the bank or the new owner giving you a period of days to move after the sale.) Now you have an eviction suit on your record for any future LL to see. (Even if it is later dismissed or you win, it still will show up on a court search for you. Most LLs don't bother to go further once they see an eviction filed.)

Now you will have to go to court and see if the judge awards him any damages beyond the deposit for the lost rent. If you had only a m2m agreement and left no damages, and you gave adequate notice, he should get nothing more. But if you had a lease, depending on your state, you may end up owing him more. In some states, a LL has no obligation to mitigate damages (lost rent) until your lease ends. (Basically you're on the hook until the lease is over or the house if foreclosed.) If you had a lease, he can ask for advertising if he tried to re-rent it, agent fees if he uses one to find a new tenant, utilities if you were responsible for them (in some areas), any difference in rent if he had to lower the rent to find a new tenant, or any other unreimbursed expenses he may have suffered if you broke a lease.

Foreclosures are big right now, but not all of them go through. It's better not to assume that the LL will lose the house until that time comes. It's better to get a signed release to let you out of any lease. I know it doesn't seem fair, but he provided exactly what your agreement said he would - that piece of property for a certain price. I hope this all works out for you. Good luck.

Originally Posted by Unregistered

You seem very knowledgeable regarding the laws. Maybe you can help me.
I paid my rent of $2,000 on time for 2 years to my landlord. We started getting flyers in the mail saying savyour home from forclosure, which got us thinking, whats going on. Through our own research we found that the landlord hadn't been paying his mortgage and was starting foreclosure. We got this info 3rd week of April, I was due to have a baby the next week. We began looking for a new home, emailed the landlord saying we were aware of the foreclosure, it wasn't right/fair etc. Requested confirmation, of the foreclosure and said we wuld move as quickly as possible...we would try to get it done by the end of May, but with a new baby (i delevered later that night I sent the email) it could take a little longer. I asked if they would be so kind to allow us to keep May rent (as they weren't paying their mortgage anyway) and please return security deposit of $3,000---since there is NO DAMAGE and the house would be left the exact same way we got it, andlso because they were losingit to the bank anyway and therefore wouldn't be making any improvements to justify keeping the sec deposit. We got no reply from them. 3 weeks later we were served with a 3 day notice, it was over the holiday weekend..so we got extr days. On May 30th we were served with a smmns of unlawful detainer. We moved May 31st. I called their lawyer requesting t drop the case, and the lawyer thought they would...but it turned out the lawyer was unable to get hold of them. So, to cover my butt, I had to answer the unlawful detainer (it cost $360 to do so) and i guess now I just wait for a court date. None of his seems fair. They are defrauding the mortgage company, they defrauded us...and yet the laws are written to protect people like them? I will fight them in court and will go to small claims and sue to the fullest extent I can! I am out so much money with the cost of court the move, the searching for a new home the stress, worry and the time spent researching and not enjoying the special time with my new baby...I can't put a high enough pricetag on that! Do you are does anyone think I have a winnable case?

Im in the SAME SITUATION !!! email me tiffin30@gmail.com !!!!In in San Diego !! SAME !! Our LL is totally defrauding us and making up fake documents !

tiffin30, Please post your problems on this forum. I try not to e-mail individuals (because of the chance of viruses on the attachments, the sheer volume of e-mails I already receive, and the number of forums I post to). What specifically is the problem - what documents is he faking, what problem is there with a foreclosure, etc.? If the LL is providing you a place to rent in return for the rent payments you make to him, he is not defrauding you. There is no promise in your lease agreement that says he will keep up with his debts or mortgage. His debt problems are his own and do not affect you until his house is foreclosed. Please post you concerns here.

[miami fl]

I am in a similar position as many here.... PLEASE ADVISE

- Moved into a townhouse here in Miami, Fl, March 1st, 2008. Gave a security deposit check as well as last month's.
- Started to receive phone calls from a particular bank asking for one of the landlord's, even though the phone is in my name, but I do receive all his mail.
- During the month of May received a lot more phone calls and was discreetly told by the bank that they needed to get in touch with LL or I may find myself in a difficult situation. I actually asked a lot of questions.
-Confronted my LL for June check stating my insecurity of living here... he said he is trying to get a rebate on the house due to value dropping...his lawyer would call me.
- His "Lawyer" called me reassuring everything, I asked him to e mail me all details and his name...haven't heard back.
- Sent an e mail to my LL stating I wanted to meet the the other LL on lease and have a sit down with both of them as I have a right to feel concern due to numerous phone calls. No response from LL.
- Landlord has changed his phone number again.....
-Bank called again today- I asked numerous questions, stating my concern and wanting my last month and security deposit back. Asked if I should pay July rent. He suggesting going to housing department and opening an Escrow account to put rent money in.
- What the H*** do I do? Have 2 little babies and we pay $2800 per month rent.

Thanks

First, send a letter to the bank that is calling you. Explain that it is your phone number they are calling and not the LL's. Explain that you are a tenant in this house and that the LL does not live there. Give them the LL's address and new phone number. Ask that they send you notice of any foreclosure notice or sale since you have rights as a tenant. Send this by certified mail, return receipt requested, and keep a copy.

The bank believes the LL still lives there since they send his mail there - start marking it "moved to xxx address" and put it back out for the mailman. (That's why they looked up a phone for that address and are calling that number.)

You can forget the LL sitting down and discussing his finances with you. Probably not going to happen. You have no right to know about them. You have the right to stay in the house for each month that you pay rent. You must continue to pay rent as long as he still owns the house. The advice to open an escrow account will probably not fly with the court. You do not have a habitability problem, which is the only legal reason to pay rent into escrow (rent withholding).

You have not yet received any notice of foreclosure. You have no notice of a sheriff's sale pending. Until that notice is posted on your door or sent to you in the mail, ignore (as best you can) the issue. Yes, you may eventually have to move out. But you will recieve at least 30 days notice in writing to do that from the sheriff, the bank, or a new owner. Or the owner may make arrangements with the bank and save the house from foreclosure. Until then, don't worry yourself to death over something that may or may not happen. A foreclosure takes months to occur.

Is it possible to ask for my security deposit back now- ha ha, I know silly question but I could right?
Part of the problem is that I pay for any repairs then subtract it from the rent with a receipt since he never answers his phone. I give him a copy and keep one for me. We agreed on this arrangement. Now I need to get the AC coils cleaned and it is about $300 but I no longer want to pay for anything in case he does lose the house then I am out that money as well.
My neighbour on the other half of the house said that he has been paying the insurance on the entire town home and is also trying to find out info on the landlord. He wants to put a lien on the house as well.
I have a friend of a friend real estate agent trying to find any information and he discovered that the house I live in isn't even registered in the county. The other half is however.
Everything is very suspicious. My landlord says he works for the Government of the Dominican Republic with "loans."

State laws say the deposit is not to be touched until you vacate, so you can't ask for it to be returned now. He has no obligation to even entertain that question. If you don't have the arrangement of deducting repairs in writing with him, I'd stop it immediately. He can say he never agreed to this and you would be deducting illegally. If you can't show any court in writing where he allowed you to do so, you may not repair and deduct without first sending a written repair request to the LL and allowing him time to repair himself. If you skip this step in repair and deuct, the deductions are not lawful. He could sue and you'd have to repay him this money! Instead send the repairs in writing to him by certified mail, return receipt requested, and keep a copy. If repairs aren't made within a month, call the clerk of court and ask about repair and deduct remedies. (They are NOT legal in all states!)

Why is the other tenant paying the insurance???? Tell him to stop. He cannot place a lien on the house without obtaining a court judgement against the LL. So if he continues to pay the insurance, he is just tossing away money. I suggest that you both just pay your rent normally for the period that you live there. You have to continue to pay rent since you are still living in the units and since the LL still owns the property.

If you want to see if the unit is registered, call the city department that handles that and ask. Don't rely on 3rd hand knowledge. It may be that the city only registers each property once (thus only one address shows up in the computer - the other unit's). Call and ask.

The last post sound very similiar to my issue. My husband and I with our four kids and two dogs rented a home only 5 weeks ago. We got the Foreclosure junked mail which was a hint since we just came out of another foreclosed rental (What luck). I feel really stressed and angry and feel like we have been defrauded. We found out that the owners have not made a payment since December and we signed a lease in May. At this point we need to get are finances in order so that this inconvenience does not cause a massive hardship. Meaning, I don't want to pay rent to the Land lord who is obviously pocketing the money. We need to save our family because the LL certainly doesn't give a hoot. What do you think is our best strategy?

You can't stop paying your rent. The LL still owns the property and whether he pays his mortgage or not is not your concern. (At least not yet.) You need to continue to pay rent until such time as the actual auction is held and a new deed is recorded, or the bank notifies you that they have taken over. If you fail to pay before then, he can actually file eviction against you and put this big blight on your court record. (It does show up for years. And yes, he can have you evicted even if he didn't pay the mortgage. His finances are his concern and shouldn't affect your payments.)

If or when the foreclosure process is finished, you will receive notice from the bank or new owner to vacate. You should get at least a 30 day notice. Some banks will actually pay you cash to move out. Until then, continue to pay and live up to your lease.