Renters Who Lose Homes to Foreclosures  Most of the occupants are homeowners, who must scramble to find housing with very little notice. They're being joined by scores of renters who discover, often with no warning, that their rented house or apartment is now owned by a bank, which wants them out. Federal legislation signed in May 2009 gives important rights to tenants whose landlords have lost their properties through foreclosure
Owners
Typically, foreclosed home were owner-occupied, but many were also owned by
investors and speculators who were hoping to profit from the rents and
rising equity. They got caught between falling housing values and
rising mortgage interest rates. Many speculators were not cash heavy
and couldnt sell or cover their monthly costs. In short, they lost
their investments
The Bank as Property Manager
If the
bank becomes the owner, it may pay a property management company to
handle the property. But don't expect service. These properties are an
albatross and wont get much attention.Many tenants have no idea that their building has been taken at foreclosure. They continue to pay rent to the former owner, who often pockets the money but isnt inclined to maintain the building they no longer own. Because the banks are stuck with so many foreclosed properties that they can't sell, they were not committed to maintaining the property making life impossible for their tenants until those tenants are evicted.
How it Was
Before May 20, 2009, most renters lost their leases upon foreclosure.
The rule in most states was that if the mortgage was recorded before
the lease was signed, a foreclosure wiped out the lease (this rule is
known as "first in time, first in right
May 20 2009 The
rules changed dramatically on May 20, 2009, when President Obama signed
the Protecting Tenants at Foreclosure Act of 2009. This legislation
allowed the lease to survive a foreclosure. That means the tenant could
stay at least until the end of the lease, and that month-to-month
tenants would be entitled to 90 days' notice before having to move outNot perfect, but at least we are beginning to pay attention to the hidden victims in this mess, the tenants that pay rent on time and do no wrong. REsourced from www.yourpropertypath.com You may republish this article, as long as you do not edit and you agree to preserve all links to the author and www.yourpropertypath.com
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