Renter's home about to go into foreclosure


Q: The property I am renting is in contract (for a) short sale. The owners have not paid their mortgage since June. I have received notices on my door. I am under the impression that if they are not paying their mortgage, they are not to be collecting rent from the property. This is a breach of contract on their part from what I have read. I am just looking for some answers and what rights I have as a tenant, and if I should stop paying rent on a property that is in default.

A: I know this may be a tough pill to swallow, but experts will tell you to keep paying your rent, even if you suspect your landlord is not paying the mortgage. If you stop paying your rent, you can lose rights that may protect you from being evicted.

I’m not an attorney and can’t give you legal advice. I strongly recommend you contact an attorney to discuss your legal options.

Sadly, the situation you describe is far too common across the country and in Southern Nevada. In recent years, thousands of locals and millions of Americans have received notices like the ones you’re apparently receiving indicating the home they’re renting is about to change hands as part of a foreclosure or short sale.

Since the housing downturn, more than five years ago, RealtyTrac reports that more than 8 million properties nationwide have gone into foreclosure. An estimated 40 percent of the people living in those foreclosed homes were renters, according to the real estate research firm and the nonprofit National Low-Income Housing Coalition.

This situation can be especially unsettling for tenants like you, since they face a relatively sudden loss of their residence through no fault of their own.

Compounding matters, many tenants don’t know what rights and options they have in such situations.

Tenants facing such situations may be protected by a federal law called the Protecting Tenants at Foreclosure Act of 2009 that allows them to stay in the property they are renting for the duration of their lease in certain circumstances.

If you’re getting notices from the lender who holds the mortgage on the property stating that the owner is in default, you can contact the bank. In some instances, banks may allow you to pay rent directly to them so you can continue living there.

In any case, it’s a good idea to keep good records documenting how and when you paid your rent each month. Once the property changes hands, or falls into foreclosure, this will help you prove to the new owner that your rent payments are current.

You said the property is under contract for a short sale. Some short sales allow the tenant to remain in the property. You should contact your landlord for more information on the short sale and its effect on your rental agreement.

To find out if the property you’re renting is in foreclosure, you can go online and check county records. In Clark County, you can contact the county assessor’s office at www.clarkcountynv.gov/Depts/assessor/Pages/default.aspx.

Finally, you may want to seek the help of a qualified lawyer or legal aid center with experience dealing with landlord-tenant cases to discuss your potential legal options. Here in Southern Nevada, several counseling centers offer free and low-cost legal aid. Options include the Legal Aid Center of Southern Nevada, at www.lacsn.org or 702-386-1070. The State Bar of Nevada also has a lawyer referral service, at www.nvbar.org/content/lawyer-referral-information-service or 702-386-1070, which can refer you to an attorney who can assist you.

Send real estate questions to me at ask@glvar.org.

Dave Tina is the 2013 president of the Greater Las Vegas Association of Realtors. Email questions to ask@glvar.org. For more information, visit www.lasvegasrealtor.com.

 

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