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Would you like to buy a Short Sale or a Foreclosure already with a Tenant?

September 8, 2009

You might want to really think again about that!

I don’t think that anyone has considered what happens to a tenant living in a home that will be sold as a Short Sale or one that actually goes through the Foreclosure Sale at an auction.  They have their rights to live in that property since they have a binding lease, even though the original owner is no longer the owner of that property.

Law states that as long as there hasn’t been a foreclosure, then a tenant must be given either a 30 day or 60 day notice to terminate a tenancy.  30 day notice is required for a tenancy of less than one year remaining on the lease.  60 days notice is required for a tenancy of one year or longer.  But if the foreclosure sale has taken place, the tenant must get a 90 day notice prior to eviction.

So, you have bought  the perfect home for you to live in – and you have a tenant you must evict.  And to top it all off, you have a new mortgage which starts at close of escrow, yet you cannot move into your home.

Now, if you are investor buying a property, that may not be such a hardship.  You already have a tenant paying rent, but that agreement is with the old landlord.  Will they continue to pay rent, and who do they pay it to?  If you are lucky, the tenants will be thrilled they still have a home to live in and will agree to a new rental agreement.  If not, then even you face evicting them, but still with the time frames mentioned above.

Just one more caveat to add in to the mix of buying Short Sales and Foreclosed Homes.  Isn’t life grand???

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2 Comments leave one →
  1. September 8, 2009 6:00 pm

    You know, I have to tell you, I really enjoy this blog and the insight from everyone who participates. I find it to be refreshing and very informative. I wish there were more blogs like it. Anyway, I felt it was about time I posted, Ive spent most of my time here just lurking and reading, but today for some reason I just felt compelled to say this.

    Like

    • September 18, 2009 11:54 am

      Thank you, I appreciate the comments. I would just like the public to understand what the housing market is really all about right now and if I can help educate, it makes my job easier too.

      Like

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