These days the foreclosure charges are quite high as a result many householders can face the misfortune. People tend to lose their jobs arbitrarily and without cause. Due to that reason, they might fail to make their timely mortgage payments, and that might create tragedy for the landlord if they do not have any backup option.
But, have you ever thought what would happen if you rented your home and suddenly your landlord is in foreclosure? A situation like this can pose quite a challenge for everyone involved. The landlord’s foreclosure is likely to affect not just the landlord, but you as the tenant too.The first thing that occurs is the landlord may issue you with a notice to vacate which can be somewhat inconvenient.
Despite this sad state of affairs, there are several ways to overcome the challenges of foreclosure:
1. Know the Scheduling of Sheriff Sale
Once your landlord has informed you about their foreclosure, the very first step is to establish the time and date of sheriff sale. You can also search for your state laws of foreclosure to learn if they can get any release time after the sale. If you fail to establish any release time in the foreclosure laws, then the only alternative would be to move out as soon as possible.
Actually, you may be required to vacate the premises within 14 days after the auction. You can also discuss with the bank or lender to get more time, but it cannot be guaranteed that you will get extra time to move out of the house.
2. Take The Cash for Keys Deal
There are cases when the bank will offer you or the landlords some money to leave the house. They might provide you with thousands of dollars just to leave the house. This happens because banks like to create a good impression and want you to leave the house in good condition. This form of deal with the bank is known as a cash-for-keys deal. Unfortunately, in some cases, the money offered by the bank is not sufficient enough to cover your general losses.
3. Vacate the premises if Your Landlord is in Foreclosure
Once you have come to know about the foreclosure, it is best to decide to vacate. You can also vacate the house by stating positive eviction In case this abrupt move causes a dispute with the landlord; you can opt to sue them later. This is a wise decision and can help you get your deposits back to yourself. To do so, you only have to file a claim at the small claims court and state that your reason for moving out of the house was because the landlord was facing foreclosure.
4. Beware Of After The Sheriff Sale
In some cases, the bank may become the owner of the house so it is recommended one should beware of the sheriff sale. As the bank may become the owner of the house and your rent payments are required to be made to a trustee or the attorney of the lenders which might again create a problem for you. Most of the times, banks will try to forcibly evict anybody still staying in the property after the sale, but there can be a chance to continue paying rent if the bank allows you to do so.
5. Get to know The Whole Game Plan
As discussed you should be aware of the sheriff sale as the bank may own the property to your detriment. In a nutshell, get to know the whole game plan. This is going to help you in future because this is a passing challenge that can be reversed by the acquisition of new property to rent.
The realization that the house that you are renting is facing a foreclosure can be tough to digest. The fact is, you as the tenant are a big part of foreclosure process which can live you homeless or destitute. You are likely to face many problems in finding a new house for rent. The outlined factors should help a tenant understand how to deal with the challenge of foreclosure of property in which they are residing in or renting.