Your Rights as a Tenant if Your Landlord's Property is Foreclosed
Authored By: Colorado Legal Services
What are my rights during the time my landlord's property is being foreclosed?
When the home you are renting is in foreclosure, the owner (your landlord) no longer owns the property once the foreclosure sale is completed. Once the foreclosure is complete, there will be a new owner of the property. The new owner may have to follow the provisions of the Protecting Tenants at Foreclosure Act, signed by President Obama on May 20, 2009. Under the law, landlords generally must give tenants at least 90 days notice before proceeding to eviction.
What are my responsibilities?
Even though the property you are renting is in foreclosure, you still are responsible for paying rent to the landlord. If it has a written assignment of rents, the mortgage company may try to collect rent from you. If the mortgage company attempts to collect the rent from you, ask for a copy of a written document which gives the mortgage company the authority to collect the rent.
What about my security deposit?
Landlords who are in this financial position are frequently unable to return security deposits. Colorado law requires that your landlord either return your security deposit or send you a letter explaining why he is withholding it. This must be done within 30 days after you move out, or 60 days if the lease you signed with the landlord states 60 days.
If you are worried that your landlord will not return your security deposit, you may want to try to bargain with him and ask if he can return it to you immediately. You could also ask if he would allow you to apply the security deposit against your last month's rent. Put any agreement you make with your landlord in writing.
The new owner wants me to leave the property. What rights do I have?
If the new owner is not covered by the Protecting Tenants at Foreclosure Act, she may ask you to leave. However, the new law covers most rental properties of one to four units. If the new owner is not willing to enter into a new lease with you and wants you to move, the new owner will give you a three day notice to move. If you get such a notice, you may want to ask the new owner why she does not have to follow the new federal law. If the new owner brings an eviction action against you, you will get a "Summons and Complaint" from the court and will have an opportunity to "Answer" it and appear in court. Raising the new federal law may be a valid defense and prevent an eviction judgment against you.
The information above is provided by Colorado Legal Services. It is intended as general information only, and is not meant as legal advice for any specific situation. If you need legal advice, consult an attorney of your own choosing. If you cannot afford an attorney, talk to Colorado Legal Services: 303-837-1321.