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California renter's rights if house is in foreclosure?

If I am renting a house in California (I'm not sure if the laws are different in other states) and the house is in foreclosure and the owner has not paid the mortgage for the last 6 months. What obligation do I have to pay the rent? According to the California Department of Fair employment and housing I need to continue to pay the owner but everything I see in the media and the small amount of information I have read online says I'm not obligated to pay. What does the law say?

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  • Dan B
    Lv 7
    1 decade ago
    Favorite Answer

    You cannot live anywhere for free. You must still pay the rent to the current owner. Watch out for scams from people who say they are the new owners and you have to pay rent to them. Make sure they can PROVE they are the new owners. Some states are enacting renter's rights relating to situations that you are in. Sometimes, when the foreclosure is complete, the renter is evicted with little or no notice. Check with CA laws on this subject. Just make sure you receive receipts for all of your rent payments.

    I would start looking for a place NOW in case you don't get much time later to find a new place to live especially if you are near the end of your current lease. You may even be allowed to break the lease without penalty. I don't expect your landlord has your security deposits anyway - that's probably gone.

  • 1 decade ago

    If you don't pay then they can evict you and thats going to add a whole lot of other problems. you have to keep paying rent to your current landlord. Keep receipts, bank statements, etc. In some cases the court will appoint a "receiver" who wil receive the landlords rent payments for them. Should this occur, the courts will give you a notice of who the receiver is and you simply pay them. If you don't receive such a notice, pay to your landlord like you would normally, depend on them for maintenance and repairs like you would normally, and pretty much go about normal tenancy.

    Once ownership of the property has officially been transfered to the new owner (may be the bank), then you would simply start paying rent to the new owner. Foreclosures can go on for a long time...sometimes 12 months or more. It's imperative that you simply keep paying rent to the current property owner/landlord for the duration. If someone else comes around claiming you owe them rent now, get it in writing, verify they own the property, and then notify the old landlord that ownership has transfered and you will no longer be paying him rent.

    Should the actual closing of the property take place mid-month and you paid your rent at the beginning of the month to the previous landlord, your rent is considered paid. The old landlord will have give both the remaining pro-rated rent for that month, and the security deposit, to the new owner. Don't be duped into paying rent twice to 2 seperate people. And don't let lendors, owners, or agents abuse you into paying them money you aren't sure you owe. If both the old and new owners come around demanding rent, present them both with written notices that you will pay rent once they communicate with each other to determine who has renting rights for the property.

    But since you are still renting, you do have a legal obligation to pay rent. Should you stop, the landlord is perfectly within his rights to begin eviction proceedings against you. The property being in foreclosure doesn't protect you from lawful eviction.

    Once the foreclosure is over and new ownership has begun, you have a right to maintain your tenancy through the end of your lease agreement. If you are renting month to month, you are allowed 90 days.

    That's what the law says. If you want to maintain your tenant rights, you must pay rent.

    Edit: A lot of people don't seem to know this yet, but as of May 20, 2009 Obama signed a law into effect giving tenants who are the victims of foreclosure enhanced rights. In this new law you are allowed to live on the property through the end of your lease agreement, or else have 90 days to vacate the premises. Just because the property has a new owner, that doesn't mean you have to simply stop living there when they say so. You get 90 days for month to month rentals, or else the duration of your lease (and the new owners are responsible for refunding the security deposit). If the new owners are going to occupy the property as their primary residence, they must give you 90 days to vacate (even if you have a lease).

    Source(s): California renter, and I know my rights
  • 5 years ago

    2

    Source(s): Rent To Own Homes : http://renttoownhome.iukiy.com/?Dssl
  • 1 decade ago

    I live in CA and what you are learning about this issue is dead wrong. You owe rent per your rental agreement or lease. Keeping paying your rent on time and in full to the party the rental agreement designates.

    If you receive notice of an ownership change, demand proof of this. There are scammers who will claim they now own the house you live in and direct you to pay rent to them. It is very easy to forge bank letter head and e-mails.

    Next issue:

    Foreclosure is not in and of itself grounds for eviction. The new owner can retain you as a teanant or not. But he or she has to follow the local and California eviction laws if that person wants you to move. They can't use foreclosure as an excuse. They need cause if you live in a city that requires cause or they can terminate your tenancy after the lease is up under the No Just Cause rule.

    Next issue:

    Do you pay the water, garbage removal and power? If so then good. If not then you better find out who is paying these costs and make sure they are being paid. You don't want your water and power cut off because of nonpayment. If you are not required to pay for water and power directly then don't let the water company or power company strong arm you into paying a debt you don't owe. If you pay such costs so you can keep the lights on and the water running then, do not deduct them from your rent. Legally you can't do that. Legally the owner has to reimburse you for these costs.

    Final Issue:

    I assume your rent checks continue to clear the bank. If they stop clearing your bank then don't be so quick to celebrate and go out and spend that money. If the current owner leaves town in the middle of the night and lets your rent payments rot at the post office, then you will still owe rent for those months.

    Good luck with this. Keep paying your rent and don't get scammed by anyone posing as a banker, real estate agent, or anyone else who claims you now have to pay rent to them. If the water or power company tries to cut your service off, go down there, get in their face, show them your lease and tell them this foreclosure and non-payment garbage is not your concern. The water or power company won't want bad PR so they will probably keep it all on.

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  • 1 decade ago

    You need to continue to pay the rents, regardless of the foreclosure scenario. Should the home change owners due to foreclosure, then you need to pay the NEW owners (probably a lender) until you vacate the premises. You get to live nowhere for free.

  • ?
    Lv 7
    1 decade ago

    You have to pay. The foreclosure is not legally your concern. The new owner can continue your tenancy or not at his option.

  • 5 years ago
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