We've been renting the house with the option to buy from a real estate investment company, but paperwork from the county courts was placed in our door stating that an attorney was to receive their properties. Does this mean they have gone into foreclosure on them all? Or just lost them all? Do we have to hurry up & move out before a lock is placed on the doors? I've never experienced this before. I always thought the real estate investment people were crooks, now I know. But what does all of the legal wording mean in laymans terms? Please help!!
A receivership is kind of like the state version of a bankruptcy trustee in federal bankruptcy court. It most likely means than the real estate investment company defaulted on its mortgage and that, for the time being, a creditor realizes that the property is worth more keeping it going as a rental property than to terminate the rental property business there and find a new buyer. In order to maximize their ability to get as much of the delinquent debt repaid as possible, the creditor has gotten the court to appoint a receiver to manage the property to prevent it from being wasted by the prior owner or from drying up the abaility to continue to collect rents from its tenants if it were suddenly foreclosed on and sold at a sheriff's auction. A receiver is a person or entity appointed by a court to take possession of property, receive rents from the property and bring legal actions in relation to the management of the property, much like a bankruptcy trustee does in federal bankruptcy proceedings.
If you cannot afford an attorney, you should strongly consider Legal Aid so you have someone who can learn more about what exactly is going on with the property and what the receiver's intentions are related to your lease.
With the bubble of the housing marketing imploding, we're seeing more tenants being evicted for their landlord's failure to pay the mortgage than a tenant's failure to pay rent. As a residential tenant, you are still entitled to at least three days notice to vacate the property before the receiver can initiate eviction proceedings to order you off the property.
I'd take the paperwork posted on your door to an attorney as soon as possible in case it's a legal pleading that you need to respond to quickly in order to protect your rights in the property.
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