Inform Article

Help for Renters in Foreclosed Properties: Part I

06.29.2010
Posted by Noelle Smith of Legal Aid Society of Palm Beach County
Help for Renters in Foreclosed Properties: Part I picture

The house I am renting is being foreclosed. What are my rights?

What Is A Foreclosure?
If your landlord does not pay his mortgage, the mortgage company may file a foreclosure. A foreclosure is a lawsuit filed by the mortgage company when the owner does not pay the mortgage payment. In the foreclosure, the mortgage company asks the court to sell the property to pay off the mortgage.

I Am Only a Tenant - Why Am I Being Served?
If a foreclosure is filed against your landlord, you as a tenant will usually be served with the foreclosure lawsuit as well. This is to ensure that any judgment the lender obtains will cover everyone who may be occupying the property or have any other interest in it. Either the Sheriff or a process server will hand you a copy of the lawsuit. Even though you are a party of the lawsuit, the foreclosure complaint will probably refer to you only as "unknown tenant" or "John/Jane Doe."

What Should I Do If I Am Served With Notice of a Foreclosure Against My Landlord?
Even though you do not own the property, you should file an Answer to the foreclosure. In the Answer, state that:

• You live in (i.e., are currently in lawful possession of) the property;
• You rent the property (i.e., you are a tenant; not the property owner);
• If you have a lease, state so in your Answer;
• If you have a lease, state the date your lease began and it is to end; and
• If you have a lease, attach a copy of the lease to your Answer.

If you file an Answer, it will tell the judge and the mortgage company that a tenant is living in the property. You will also be notified if any hearings are scheduled in the case. If you do not file an Answer, you will not receive any notices about the foreclosure lawsuit, and you will not know what is happening in the case.

Do I Have Any Special Rights If I Once Owned the Property Where I am living?
If you are living in a home that you used to own and you have the option of repurchasing the property, though a "lease/buy-back" or otherwise, it is important that you write this in the Answer. You should also talk to your own attorney because the law in this situation is complicated.

What Should I Do If My Landlord Tells Me She Plans to Stop the Foreclosure?
If you receive a foreclosure complaint, you should contact your landlord to find out what she intends to do about the foreclosure. Many times, after a foreclosure is filed, the owner pays the mortgage company enough money to stop the foreclosure. If the landlord does this, the foreclosure should be dismissed. Even if your landlord tells you she will stop the foreclosure, you should still file an Answer in the foreclosure lawsuit.

What Should I Do If My Landlord Tells Me She Cannot Stop the Foreclosure?
If your landlord tells you that she is not going to be able to stop the foreclosure, or if you cannot find your landlord, you should still file an Answer in the foreclosure. Although it may take several months for the lender to obtain a final judgment of foreclosure, you should prepare to look for a new place to live. Legally, you must continue to pay rent to your landlord during the foreclosure process. If you plan on moving, you need to comply with any notice requirements in your lease.

For more information from Part II, click here.


For assistance with foreclosures, please contact Legal Aid Society's Foreclosure Defense Unit at (561) 655-8944 Ext. 325, or email us at foreclosuredefenseunit@legalaidpbc.org.

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