Renters Are Overlooked in Foreclosed Property

What are the rights of tenants in property that is being foreclosed?

Think you are safe, if you are renting or a tenant in property that is being foreclosed? Think again. Renters can be evicted if the property owner forecloses on the property with their lender.

Most renters don't suspect that their landlord is having mortgage troubles until they receive the eviction notice. If a renter is current on their rent payments, they have little recourse but to leave the property.

Who Are the Renters?
There is not just one profile to renters who lose their homes to foreclosure. They could live in single family homes, smaller apartment buildings or condos. They could be in a big city, suburb or a neighborhood. Foreclosed homes are everywhere and they cross all economic levels.

Who Are the Defaulting Owners?
There are several types. Many are owner-occupied. Some are owned by investors and speculators. When regulation was lax, anyone who breathed and could sign their name could get a loan with an adjustable rate and many bought-up rental properties. The owners counted on rising rents and low interest rates to cover their mortgage payments. Caught between the slump in housing values and the rise of their mortgage interest rates, the owners could not sell nor extract enough rent to cover their monthly costs.

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