1

What is the Law?

The Protecting Tenants at Foreclosure Act, Pub. L. No. 111-22, A?A? 701-704 (2009), which became law on May 20, 2009, applies to state eviction proceedings. The act requires that a new owner who took title to residential rental property through foreclosure must honor existing leases until the end of the lease term.

2

How does it work?

If the landlord is in foreclosure and the sale goes through you, the tenant may be protected from eviction.

3

Are there any loopholes?

There are three exceptions to this rule: 1) if there is an existing term lease and the new owner wants to occupy the foreclosed property as a personal residence before the end of the lease term, 2) if there is an existing term lease with less than 90 days to the end of the lease term, or 3) if the existing lease on the foreclosed property is a month-to-month tenancy or a tenancy at will. In each of these cases, the owner must provide the tenant at least 90 days notice to terminate the tenancy.

4

What if I get a Foreclosure or Bankruptcy Notice but don't know what has happened yet?

When you are a tenant and the property you live in is in foreclosure, or the landlord has filed bankruptcy you need to keep a couple of things in mind. First, while the landlord is on the Deed the landlord owns the property. Second, a foreclosure lawsuit does not mean that the landlord will lose the property in foreclosure. The bank may not follow through or the landlord may salvage the property. As long as the Landlord is on the Deed they own the property and can collect rent. Third, many times a landlord will file a bankruptcy to restructure the financing of the property. They are still the landlord. As long as the landlord is on the Deed they can act to evict you. When the landlord is no longer the owner of the property you will be contacted by the new owner.