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Renting but house going through Foreclosure and possible short sale

Mesa, AZ |

I am renter in Mesa AZ. We have been renting since March of 2010. 4 months after we moved in we received a Trustee sale notice for 10/22/10. I have been checking the LPS website daily to make sure it isnt postponed. So last night the landlord tells me that he has an offer on it to the bank. When I checked today on the sale date, it shows postponed till 11/23/10. My original lease was until end of August 2010 and at that time we had a choice to receive another 6 month lease for $25 more. Well since the foreclosure notice we never received the option for the 2nd 6 months and we are month to month. If the bank approves short sale, how long do I have before I have to vacate?

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Attorney answers 2


In general, a sale of a home is subject to existing liens and your lease constitutes a lien against the property. So, a buyer of a short sale home takes the home subject to the lease and your rights under the Lease, unless your lease provides otherwise.

Nothing in this answer is intended as legal advice and no attorney-client relationship exists unless the author enters into a signed fee agreement with a client. Every borrower and owner should consult independent legal counsel to review their situation and evaluate their risks and issues. Any opinions expressed herein are based on the author’s interpretation of existing law, anti-deficiency policies and practical experiences working in the area. However, the facts of each case can be different and different facts can result in different outcomes. Moreover, the law can change and courts will continue to shape the interpretation of statutes addressing these and related issues.

Marc McCain
McCain & Bursh, PLC Attorneys At Law
(602) 602-2138

The Firm practices in the areas of real estate, personal injury, contracts, corporate law and commercial litigation


I understand that your initial 6 month lease had an option to renew for another 6 months, if you paid an extra $25. However, I don't know if the $25 was the option fee or an additional monthly increase. This would make a difference. If it was a fee to exercise the option, then the burden was on you to pay it in order to exercise the option. Otherwise, the terms of the original lease would likely dictate the nature and ability to exercise the option.
In any event, since you appear to be in a month to month, a 30 day written notice would likely be required under a transfer by Trustee Sale. With a short sale approval, you should still have a 30 day written notice from the landlord.

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