What should you do if your landlord is facing foreclosure?

by Enrique Jevons

One of the worst things that any tenant faces as a renter is finding out that the owner of their rental property is currently going through foreclosure.

This means that ownership of the property will be changing hands and the new owner may be very different than the old one or they may want to remove the tenant from the rental property altogether.

If you live in Washington State and have found out that the owner of the rental property that you're living in is about to go through foreclosure, this article will provide you with things that you need to know as a tenant about the foreclosure process.

Do You Still Continue Paying Rent While the Property Is in Foreclosure?

Yes, even though the property is going through foreclosure, you continue paying rent on time every single month and complying with the terms of your lease.

After the foreclosure process has been completed you will no longer continue making rent payments to the original landlord, you will begin making payments to the new owner of the rental property.

Will You Have to Vacate After Foreclosure?

No, you will not have to immediately vacate the property after it has gone through foreclosure.

As a tenant, your rights will continue to be protected and if the new owner of the property wants to evict you they must go through the eviction process in the State of Washington which includes sending you a notice to vacate the rental property.

Let's say that someone contacts you claiming to be the brand-new owner of the rental property and they are requesting that you pay them rent. Before conducting a financial transaction with the new owner you should ask to see their trustee's deed to confirm their ownership of the rental property.

If the new owner does not have a trustee's deed, another step that you can take to verify their ownership is to contact your local county recorder or auditor's office to view current ownership records of your rental property.

What to Do If the Owner Pays Utilities

Does the owner of your rental property currently pay utilities? If so, one of the clearest signs that they are going through the foreclosure process is if the utilities have been turned off.

To confirm that they are indeed going through foreclosure process you should contact your local county office and request a notice of trustee sale to find out if the property is indeed in foreclosure.

Your Landlord’s Obligation During Foreclosure

In Washington State, the law requires landlords to notify their tenants that the property they are currently living in is about to go through the foreclosure process. The landlord, trustee, or bank, must provide the renter with a notice at least 120 days in advance of the day of the foreclosure sale so that the tenant can make a decision if they want to either stay in the rental property or move.

While your rental property is going through foreclosure, you should remind the owner of their obligation to either return your last month's rent and deposit back to you or to transfer that money over to the new owner.

If the old owner of your rental property fails to return your last month's rent and deposit they may be found liable to pay you twice the amount of your deposit, court costs, and or attorney fees.

One important thing that you can do during the foreclosure process to protect yourself and your rights as a tenant are to file a notice of non-abandonment with the owner’s mortgage company so that subcontractors, buyers, and lenders will know about that rental property you are living in is occupied and has not been abandoned.

What to Do After the Foreclosure

Ideally, one of the first things that you want to do after the foreclosure has been finalized it's to meet the new owners of the rental property to find out if they want to keep you on as a tenant or if their goal is for you to vacate the rental property.

It’s not uncommon for some new owners to have the desire for tenants to vacate a property after it has gone through foreclosure but, it's important for the new owners and the tenants to know that the tenants’ rights must be respected, and the law must be followed, since every tenant has 60 days or more before the end of the monthly rental before they have to vacate a rental property.

If the new owner of your rental property has the desire to get you out of the rental property before 60 days, one option that they can offer you is cash for keys.  This means that the new owner agrees to pay you cash to vacate the property quickly but the rental property has to be in broom clean condition.

Let's say that you decide to accept cash for keys, make sure that the new owners offer is in writing, there must be clear terms and the agreement, and it also must be signed by you and the new owner.

Search for Rental Properties

To search for rental properties in Washington State contact Jevons Property Management today by calling us at (509) 895-7777 or connect with us online.