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IMPORTANT PLEASE READ: The Federal Law, Protecting Tenants at Foreclosure Act, expired and is no longer valid as of December 31, 2014.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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How much notice does my landlord need to enter my apartment?
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What rights do i have as a tenant if my land lord and his wife are on bad terms and are putting us the tenants in the middle of their martial issues. Landlord is in jail for fraud and beating up his wife. Wife picks up rent money, and landlord sends people to the house to collect rent money even through we gave it to the wife without knowing the landlord was in jail. We are not trying to be in the middle of it, but who do i give the rent money to, if the landlord wants us to give it to other people? The wife wants the money too, but here's the thing we don't have a signed lease no more.
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I am a tenant and the ownr/landlord is losing the property to foreclosure and he just called me today 09-08-08 and told me I need to beout asap by the end odf the week. The question I have is can he do this the property is due to go back to the bank 09-29-08 I plan on begin out then but can he throw me out sooner?
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I live in a apt that included utilities for me as well as other temants i sighned a lease but mever got copy i asked several times. And just a week ago we were told verbally we will jave pay utilities our rents 550 a monthand aps wants$ 300 to turn off service on the 10th .i payed my rent andlights getting shut off Can my manager do this i need help
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my family and i rented a house recently(like 3 weeks ago). the house it turns out was rented to us illegally, the house is in foreclosure and we where informed by the glendale police department on thursday that we had to be out by 7am on monday morning. due to the fact that the landlord is under investigations for fraud. now i dont no what to do. dont we have to go through a court process or something before we have to leave? please can u help r give me any advice?
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My apartment is taking over by Roaches and I mean it's an infestation. I have tried buying everything and my landlord won't Spray and hire and Extermination Company what are my rights? Thanks in advance
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I rent a kitchenette in south tucson I have many issues with appliances ,plumbing, heat etc. what are my options?
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I rent an apart. in Chandler. a neighbor leaves cat food out on the sidewalk 2 feed stray cats. I talked to the manager and she says there is nothing she can do.The issue now is there is a roach and ant infestation do2 the cat food.my son turned out2 be allergic to roach bites &has fallen down and hit his head when he step on the food.there are even roaches on my bed at night when we r sleeping. She just tells.me to keep my apart. clean and has the regular guy come over to spray but this doesn't help. What can I do???
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my apartment complex is refusing to contact anyone other than their own complex repair people to fix our AC. we have been without working AC for OVER a week.. •1) can we withhold rent until this issue is resolved? •2) if so, who do we give our rent payments to in the mean time? •3) how long do they have to get the issue resolved after the 5 days from giving them written notice of the issue? thank you!
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We have lived here in an apt. type setting for 11 months. We are curious if we can break our lease based on several factors. One being that our dryer, which they supplied, has NEVER worked and shocks us (safety issue). We've complained on several occassions (including the month we moved in). Nothing has been done, and now we can't use our dryer. Or, the fact that there wasn't for at least 7 months, common area lights outside. Now there are....or the fact that my husband fell down in an area on the complex with no lights (outside apt. complex). HELP!
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