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Home foreclosure tenant's rights

Union, NJ |

Hello
I was served with a notice that the home I am renting is being foreclosed on because the landlords have not paid the mortgage since March 2012.

I have a two year lease on the property which I signed in August of 2012. The house was in pretty bad shape and as part of the deal, I fixed up the house in exchange for lower rent. The rent is only $600 a month. I put in about $5,000.00 worth of work into the house.
Now I am wondering if the bank can evict me from the house after they finish with the foreclosure.

Will my 2 year lease stand up, especially considering that the rent is low? Is the bank obligated to let me live there even though the landlords rented the house to me after they stopped paying mortgage?

I would appreciate any help

Attorney Answers 2


  1. The foreclosure theorhetically cuts off your rights under the lease. There are several caeveat here. Your lease is good until title transfers. To evict you they will have to go to Court after that which will take 2-3 months. I would guess you have about a year before anything will happen. You may be able cut a deal with the bank.


  2. As a general rule, the lease is subordinate to the mortgage - meaning that the mortgage holder has greater rights than a tenant.

    As a practical matter, that means that the bank - after it becomes the owner at the conclusion of the foreclosure process - will have the right to move to evict you. However, the bank may have an interest in having a paying tenant at the property who is maintaining it. So, at some point, it might make sense to try to contact the bank to see if they want you to remain. I agree with the other attorney, that nothing is likely to happen in the next twelve months.

    This answer is for general education purposes only. It neither creates an attorney-client relationship nor provides legal guidance or advice. The answer is based on the limited information provided and the answer might be different had additional information been provided. You should consult an attorney.

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