General Housing Information 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IMPORTANT PLEASE READ: The Federal Law, Protecting Tenants at Foreclosure Act, expired and is no longer valid as of December 31, 2014.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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Im on HUD housing and the city of tucson dont aloud me to have cameras installed do two cars breaking in tires getting popped and Slash I've even had people backing in my backyard I had a few attempted break-ins and still they will not let me install cameras
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My boyfriend and I bought a house together in December 2018, we’re going through a break up now and I need help figuring out what I need to do regarding the house.
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I am thinking about having a yard sale. I have a steep driveway. Am I liable if a person falls due only to the steepness of the driveway? What if I put up a sign to enter at own risk?
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What are the laws to have normal wear n tear fixed. How often?
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If my HOA CCR's state the monthly assessment fee and how it is going to collected, If that fee is to be increased or decreased, does this change of cost need to be recorded with the county and a change made to the CCR's?
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We own a ground floor condo. The condo above us is rented to some very noisy people, including loud repetitious boom-boom "music". Police have been here 4 times. What can we do? What proof is required to avoid the "he said, she said" problem? The boom-boom from morning to late night is making our home uninhabitable.
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I am currently in the midst of a civil dispute with the co-buyer of a house I recently purchased back in April of 2015. I have been removed from the house temporarily with an order of protection which I am currently in the process of contesting. The co-buyer is demanding I remove my name from the title. I currently have an indemnity agreement that was signed by the co-buyer, but it doesnt protect me from the mortgage company, only the co-buyer. How can I force a Judicial Sale of the house so that hes forced to refinance and take my name off the mortgage? That or the house goes to the highest
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I live in a home in which had not been occupied for about 4years. I have been here almost18months now i have done some work on the place like put locks on front door itjusthad a chain throughtthe hole, I’ve fixed resroom sink and painted, i put up a dividing fence in the back yard as well as cleaned up the entire property, I’ve finished the bedroom closet including insulation drywall and soon paint the owner of the home is telling me because i had an incident with his son locking me out of my home that now i have to move out and i have 8days. We have no wtitten agreement. What can i do?
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I retired from the army this past november and decided to move. even though i have orders my property manager is saying that i have pay a partial rent and a buyout of the lease.
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