Landlord and Tenant Rights and Responsibilities Article
WHAT IF I RENT A HOUSE THAT'S IN FORECLOSURE - The Protecting Tenants at Foreclosure Act
The Protecting Tenants at Foreclosure Act
This law expired on December 31, 2014
IMPORTANT PLEASE READ: The Federal Law, Protecting Tenants at Foreclosure Act, expired and is no longer valid as of December 31, 2014. While there were some attempts in the House to revive this law in 2015 none have been successful. Arizona State Law, A.R.S § 33-1331, gives tenants of foreclosed properties some limited protections; information about these protections can be found in this article. This article remains on AZLawHelp.org purely for historical value for those interested in how the Protecting Tenants at Foreclosure Act operated from 2009 through 2014.
There are legal protections for tenants renting a house that is in or goes into foreclosure. The Protecting Tenants at Foreclosure Act (PTFA) was passed by Congress signed into law by the President Obama in 2009; subsequently the law was extended in 2010. The PTFA expired on December 31, 2014. The PTFA, depending on the facts in a particular situation, requires that renters in foreclosed homes be allowed to stay or given sufficient notice under the law.
There are legal protections for tenants renting a house that is in or goes into foreclosure. The Protecting Tenants at Foreclosure Act (PTFA) was passed by Congress signed into law by the President Obama in 2009; subsequently the law was extended in 2010. The PTFA expired on December 31, 2014. The PTFA, depending on the facts in a particular situation, requires that renters in foreclosed homes be allowed to stay or given sufficient notice under the law.
Who qualifies for protection under the PTFA?
The tenant protection provisions apply in the case of any foreclosure on a “federally related mortgage loan” or on any dwelling or residential real property. The tenant must also be “bona fide.” A lease or tenancy is “bona fide” only if:
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The mortgagor or a child, spouse, or parent of the mortgagor under the contract is not the tenant;The lease or tenancy was the product of an arm’s-length transaction; andThe lease or tenancy requires the receipt of rent that is not substantially less than fair market rent or the rent is reduced or subsidized due to a federal, state, or local subsidy.In other words the lease must be made with another person and not with oneself and the rent payments must be a fair amount for the property that is not supplemented by the government.When do renters in foreclosed homes get to stay and when do they have to leave?Renters Get to Stay IF:Renters get to stay for the duration of the lease, if all of the following requirements are met:
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There is a valid lease (not the end of the lease term),The lease was signed before receiving notice of foreclosure (whether judicial foreclosure or trustee sale), andThe new owner does not intend to occupy the property as a primary residence.Renters Cannot Stay But Must Be Given Notice IF:In most other situations, the renters will have to leave, once the foreclosure is complete, and upon receiving 90 days notice from the new owner. The common situations where a renter will have to vacate after the foreclosure upon receiving notice are:
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Renters must vacate if there is a valid lease and they had notice of foreclosure before signing the lease; orRenters must vacate if there is a valid lease, and even if there was no notice of foreclosure but the new owner intends to occupy the property as a primary residence; orRenters must vacate if there is no valid lease, including where a lease expires and the renter is paying month-to-month.
Why does the law end December 31, 2014?
The law has what is called a sunset provision, meaning it has an expiration date. The original date was extended in the “Dodd-Frank Wall Street Reform and Consumer Protection Act”, so that the law will be repealed on December 31. 2014. When laws are written, the legislative body writing the law may set a date of when that law will end, referred to as a “sunset” clause or provision (Note: Not all laws have sunset provisions, it is not required). The PTFA is a federal law, Congress would have to authorize and extension or make the law permanent and the President would have to sign it into law.Source: See 12 U.S.C. 5220 or search the US Code online with the US House of Representatives website. For additional information see the Consumer Financial Protection Bureau website.
Comments:QUESTIONS
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My lease said nothing about breaking it so when I did my landlord said she was keeping my sec deposit. Can she do that by law if the lease said nothing about breaking it?
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Is a landlord required to send a written notice, when the landlord wants to move back into their home? In this case my daughter was notified by phone and no written notices received.
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We haven't had gas to our appliances for over a month.....what do we do an how much do we deduct from our rent
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Received a notice to vacate property due to criminal activity due to some 1 running into my apartments and police were chasing them I had no knowledge if asked the person what are you doing and made the get out and cops arrested outside of my apartment
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I co-signed for my son on his lease in May of 2016. The lease expired without a new lease being written, do he is now month-to-month. Is it possible to remove myself from liability (terminate my part of the agreement) without taking my son off the rental agreement. He had lived there almost 2 years and has established his own credibility. Am I obligated to stay on the rental agreement as long as he stays at the rental?
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Is there a time frame that a tenant can change their mind about renting, even if they signed a lease? The reason is cockroaches.
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My son began renting an apartment 3 weeks ago. He purchased new furniture other than his bed he has had with no issues. In the past four days he and his girlfriend have noticed bites on them and she now has a rash from the bites. To make a long story short they found bed bugs on the corner of his mattress that is adjacent to a electrical outlet. He cut open his mattress looking for tale tale signs of any more only to find nothing. He plans on asking his the apartment to spray his and the adjacent apartments and allow him to move out to another unit. What are his rights?
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What can I do if the landlord keeps calling and leaving me nasty voicemails?
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Can the landlord put a lock on ac unit
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Hi. I own my home and established a month to month lease agreement with additional terms (requiring a 30 day move-out notice etc) with acquaintance for our spare room. She did give a two week notice and planned on moving out on the first of the month. She ended up staying 4/5days into the next month were no rent was collected. At this time a few belonging were left behind. She had inquired to pick these items up under short notice once. It has been 6 months now and I was asked if we still had her items and wanted to pick them up. Is she still entitled to these items?
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