Condo we are renting got foreclosed!

[REINITA♥REY 8]

hello! I live in Florida and went through this before I purchased a home. I was renting a house and one day got a notice that the bank was filing for foreclosure. I did have a year rental contract, and I was only four months into it. I stopped paying rent at that moment and send the owner a certified letter that I will not be submitted payment to him as I do not know wether he has the security deposit. I instead will deposit my monthly rent into an escrow account until further notice. I also stated I would be looking to live elsewhere right away. Since the paperwork stated the mortgage was 9 months behind, he had rented me the property knowing he was not paying the mortgage an the property would go into foreclosure. He would not return my calls at this point. The fridge broke down and he refused to fix it...so I just kept a log of everything. Then a realtor came knocking on my door saying she was hired by the owner to do a short sale and if people could see the property. Lovely, huh?

If the house was foreclosed on, they bank would have put a notice on the door stating 2 or 3 days to vacate the property. You should have plenty of time and notice before it gets to that stage. You may be able to find out a lot of public information online with the owners name through the court system database. I even contacted the foreclosure lawyers and let them know I was renting the property and they included me on any further communications. Here in Florida, foreclosures and taking months to process, so you may have a good amount of time to save money and deposit on another place. In some situations, the banks are actually drawing lease agreements with the current tenants. I am not a credit expert, but I do not think the owner can put anything on your credit report.

Good Luck!

[jrmejia 31]

I would just move out! Case closed.

[SuperDuper! 230]

The bank has an agreement with the landlord about the loan not you. If I were you I would stop paying the landlord as he doesn't want to bring the place out of foreclosure. If you really like the place contact the bank after they tell you it is in foreclosure and see about buying it at the current market price ( not what idiot landlord owed )

Plus start looking for a new Apt.!

[kkrxo 2]

Hang on a second here... DO NOT stop paying your rent. It is a sure fire way to get evicted and have a real nice blemish on your credit report.

I am a Real Estate broker in Florida and I have seen this scenario more than a few times in the last few years. What state do you live in because the rules on these things vary from state to state.

We just stopped paying rent after we found out. I consulted an attorney today and he told me since I can't contact the landlord and he isn't returning our calls, (I don't even have his address) and we are living here without a lease, the new owners or the bank still have to give us a 90 day notice to leave. I asked him who we should be paying rent to now and he told me that I should contact the county clerk and see if I could deposit the rent money in some type of special account until it gets settled or to just set the money aside to be safe just incase the bank/new owners expect back pay on rent.

I asked him if the banks or old owner/new owner could put this on our credit report and he said he wasn't sure but if there isn't even a written agreement, none of our information is on file or anything (our names, social security #'s or anything) he doubts it.

I live in Illinois. We left a message to the landlord (on his voicemail) that we weren't going to be paying him rent anymore and he never called us back so I guess he doesn't care.

[kkrxo 2]

hello! I live in Florida and went through this before I purchased a home. I was renting a house and one day got a notice that the bank was filing for foreclosure. I did have a year rental contract, and I was only four months into it. I stopped paying rent at that moment and send the owner a certified letter that I will not be submitted payment to him as I do not know wether he has the security deposit. I instead will deposit my monthly rent into an escrow account until further notice. I also stated I would be looking to live elsewhere right away. Since the paperwork stated the mortgage was 9 months behind, he had rented me the property knowing he was not paying the mortgage an the property would go into foreclosure. He would not return my calls at this point. The fridge broke down and he refused to fix it...so I just kept a log of everything. Then a realtor came knocking on my door saying she was hired by the owner to do a short sale and if people could see the property. Lovely, huh?

If the house was foreclosed on, they bank would have put a notice on the door stating 2 or 3 days to vacate the property. You should have plenty of time and notice before it gets to that stage. You may be able to find out a lot of public information online with the owners name through the court system database. I even contacted the foreclosure lawyers and let them know I was renting the property and they included me on any further communications. Here in Florida, foreclosures and taking months to process, so you may have a good amount of time to save money and deposit on another place. In some situations, the banks are actually drawing lease agreements with the current tenants. I am not a credit expert, but I do not think the owner can put anything on your credit report.

Good Luck!

Thanks LADUQUE13 for sharing that with me... that was really helpful. To tell you the truth, I don't know whether these condos have already been foreclosed or is up for foreclosure... I need to talk to my neighbor who got the letter to ask for sure what the letter said. I'm going to take your advice and look through the court system database just to make sure!

So are you saying that after we get a notice on the door, that we only have 2 or 3 days to move? I spoke with an attorney and he told me that we would get a 90 day notice to leave, but I'd rather hear from somebody that's been through it.

[kkrxo 2]

I never said just stop paying did I? I said send a certified letter first explaining what they believe they know and indicating that no more payments will be made to the original landlord until they have met face to face. The op indicated that the landlord is not responding to their calls.

And if the original landlord has lost possession of the property then the new owner has to abide by all local, state & federal laws. They can't just throw the tenants out but they also don't have a contract with the current tenants especially in the case of a month-to-month residency.

I don't know our landlord's address so I won't be able to send him a certified letter but thanks for that information!!

[kkrxo 2]

Just wanted to update everyone and let y'all know that I just found our condo on the foreclosure listing site for sale on my county sherriff's website. It's going to be auctioned off on Feb 1st.

I'm going to email the sherriff and ask him what he thinks I should do...

[NigeriaorBust 4,087]

That notice includes who is in default and who is holding the lien. If you want to buy it you can contact that lien holder ( the bank) and up until the moment the auction starts it can be sold through other means.

[tom&tanya 48]

I think a culmination of the answers above are the best answer. Send the landlord a letter stating you have been trying to contact him and have received no response. Tell him you saw a letter stating the building is up for foreclosure and if he doesn't answer you in 10 days you will put the money in an account until you hear from him. He'll either answer you when he gets the letter or call you when he doesn't get his money.

Even better if you want to be sneaky...call and tell him something is broken and it needs to be repaired. See if he calls you back then. It's HIS job to repair issues. That would also be a general indicator for your sake as to what is going on with your current landlord.

I'm sorry but this is terrible advise. One cannot just change the terms of a lease because you think it's the "right" thing to do. If you went before a judge they would tell you it's the courts job to make this decision and not the tenant to decide. If someone has a lease (written or oral), the fact that the landlord is in being foreclosed upon is irrelevant to the lease. You might be able to sue the landlord for misrepresentation if you believe that he entered into the lease knowing he could not lease you the property for the full term but in this case the tenant only has a month to month lease ( In Florida we call this "Tenancy at Will").

If you plan on living there, PAY YOUR RENT!!! .... and look for a new apartment.

[Krikit 1,165]

Okay, that means the property has been foreclosed upon and the bank now owns your property. Keep your rent payments in your account until you hear from them.

Feb 1st is good. It buys you lots of time. Between now and then you should come home to a sticker on your door telling you to call a certain number. Don't panic, but do give them a call and have all your questions ready.

On Feb 1st the property will go to the highest bidder. The bank will put in a starting bid of the amount which is owed. If this is beyond the FMV (Fair Market Value) of the property, no investor is going to bid on it. In fact, the investors will only bid on it if it they can get it for ~60% of its worth as they are trying to make a profit. Unfortunately, you won't know if the former owner owed more on the property than it's worth until the auction. You can either go to the courthouse to observe, or you can wait till the next day to see the sale results online.

Assuming the mortgage is upside-down, the property will revert back to the bank. The file will go to the Asset Manager and will sit on their desk with all their other foreclosures until they can get to it. If there is enough interest in the property, an investor can keep nudging them until they get the file in motion. If no one is interested, it will sit there until it can be addressed.

Once the Asset Manager starts working on it, it will be assigned to the Real Estate Broker which the lender uses. You will see who the lender is from the auction record. Google that company for blogs or comments made by others to see how well they handle things. It will help give you an insight into what happens next.

Once it's gone to the Real Estate Broker it will be labelled REO (Real Estate Owned). You will receive notice that they will be coming in for an inspection of the property and a BMA (Broker Market Analysis). They will take pictures. The bank will also send out an Appraiser. You will need to make your condo available to that person, also.

You will also probably receive a notice to vacate and will have to go to court. But by this time you should have Plan B ready to execute. If you haven't already moved out, you will get the 90 days notice at that point. (Or the Cash-For-Keys offer.) But this is only if they are intent on emptying the property. They may just want to keep the cash flow going. I'm only giving you an educated guess, at this point, because I do not know the property or the situation.

In any event, time is on your side, so there is no need to panic. Just know your situation and your options and work from there.

As an FYI if you are looking for a new place to live, tenants are now starting to ask landlords for assurances that the landlord is not in a pre-foreclosure situation, so you are well within your rights to make sure you are not moving into another foreclosure situation. Some landlords are writing into their contracts that the tenant may request quarterly reports (for a fee) so they can receive a heads up should the loan go into default. It may not do anything to prevent another foreclosure situation, but at least you will gain fair warning.

Good luck.

[REINITA♥REY 8]

Thanks LADUQUE13 for sharing that with me... that was really helpful. To tell you the truth, I don't know whether these condos have already been foreclosed or is up for foreclosure... I need to talk to my neighbor who got the letter to ask for sure what the letter said. I'm going to take your advice and look through the court system database just to make sure!

So are you saying that after we get a notice on the door, that we only have 2 or 3 days to move? I spoke with an attorney and he told me that we would get a 90 day notice to leave, but I'd rather hear from somebody that's been through it.

No problen. You should have plenty of time before the notice is on the door. The bank probably is unaware the property has tenants. I ended up not paying the rent and having enough money saved to secure back my deposit. What KIRKIT posted is exactly the process, great post!

[Fandango 1,440]

Sounds to me like it's not foreclosed...the notice sounds like a lis pendens....I would advise you to put your rent into an escrow account until you can make contact with the landlord, and this clears itself up.

Edited November 17, 2010 by Lisa C

[Rob and Jill 82]

I'm sorry but this is terrible advise. One cannot just change the terms of a lease because you think it's the "right" thing to do. If you went before a judge they would tell you it's the courts job to make this decision and not the tenant to decide. If someone has a lease (written or oral), the fact that the landlord is in being foreclosed upon is irrelevant to the lease. You might be able to sue the landlord for misrepresentation if you believe that he entered into the lease knowing he could not lease you the property for the full term but in this case the tenant only has a month to month lease ( In Florida we call this "Tenancy at Will").

If you plan on living there, PAY YOUR RENT!!! .... and look for a new apartment.

And yet, SO many people are stating they have done just as I advised. I find it quite humorous that you're picking on what I said although I stated he should continue to try and contact the landlord. Sorry, but that is not horrible advice.

[tom&tanya 48]

I'm not trying to pick on you. Sorry if you feel that way, it wasn't meant to be a personal attack upon you. Everyone who has told this person not to pay the rent is wrong. I am simply saying what I know to be a fact. I have been in the Real Estate business for almost 30 years. The advise to stop paying rent is what most people think is the fair thing to do. But is not the legal thing to do. Let's avoid giving people advise based upon what we think is "street justice".

The last thing a person wants is an eviction on a credit report and non payment of rent is a sure fire way of achieving that. Then try to lease a new place to live.

I do have one question however: If he (or she) can't "find the landlord" how have they been paying the rent up to this point?

If in fact they really can't send the rent, they should attempt to send it to the place they were sending it to and then when it comes back, keep the check and the envelope along with the checks and don't spend the money. Get a new place to live as soon as you can.

[REINITA♥REY 8]

I'm not trying to pick on you. Sorry if you feel that way, it wasn't meant to be a personal attack upon you. Everyone who has told this person not to pay the rent is wrong. I am simply saying what I know to be a fact. I have been in the Real Estate business for almost 30 years. The advise to stop paying rent is what most people think is the fair thing to do. But is not the legal thing to do. Let's avoid giving people advise based upon what we think is "street justice".

The last thing a person wants is an eviction on a credit report and non payment of rent is a sure fire way of achieving that. Then try to lease a new place to live.

I do have one question however: If he (or she) can't "find the landlord" how have they been paying the rent up to this point?

If in fact they really can't send the rent, they should attempt to send it to the place they were sending it to and then when it comes back, keep the check and the envelope along with the checks and don't spend the money. Get a new place to live as soon as you can.

This is not a real estate matter, this is a legal matter. It is NOT against the law to send a certified to the owner stating intentions and to deposit money into an escrow account instead of paying it to the owner. If the owner does try to claim an eviction, it will be 30 days until the court hearing is scheduled. At that time, the tenant can bring all the evidence of letter sent, foreclosure, proof of funds in the account, and state the concerns about security deposit (the security deposit by LAW should have beendeposited into an interest bearing account by the owner). The judge will then make a decision, and the decision will NOT be to give the owner all the rent money....it will be less the security deposit if he orders back rent to be paid.