Tenants Get Caught In The Foreclosure Crossfire, 72 Hours To Get Out
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As we well know, many of the homes that are being foreclosed upon are owned by speculators. Once they realized that they could not sell the homes for a profit the owners went and got tenants.
When the debt burden on these multiple homes became too bad they declared bankruptcy and the homes are now in foreclosure. But the victim in this mess is the tenants who paid their first and last months rent as a deposit and have been paying the rent on time every month while the landlord was not paying the mortgage.
They are facing being out on the street in 72 hours as in most states the tenant loses almost all of their rights in a foreclosure. The banks can throw them to the curb and the only way to get their deposits back is through the bankruptcy courts. And the odds of them getting to the front of the line to get anything back is slim to none.
Tenants get hurt in several ways. Not only do they have to find a new place to live quickly, but they also are often out thousands of dollars in prepaid rent and security deposits they likely will need to rent a new place.
Cleveland says she ended up losing about $4,500 in rent and deposits and had to go into her savings to pull together enough money for the house she subsequently rented.
Jon Janecek, a real estate attorney at Newmeyer & Dillion LLP in Newport Beach, Calif., says the courts offer little help to most evicted tenants. They can sue in small claims court, but even if they win a judgment they may have difficulty collecting because the landlord can’t be found. If the landlord files for bankruptcy, the tenant becomes just another creditor. Both procedures take months.
The tenant also must deal with the lender who foreclosed. The lender often doesn’t know there is a tenant and wants the prop-erty sold as quickly as possible. The lease provides no protection because it is void once there is a foreclosure.
“The tenant and the lender in this situation are like two cats thrown in a box,” Janecek says. “It’s like, ‘Here it is; you figure it out.”‘ via NWFDailynews.com.
It probably is a really good time to buy real estate - monthly payments are about equal to market rents ...
The part about the inventory is right on but in my area they are mostly low end and beat up ...
I worked for this man, he is a great con man and has done this in more than States then ...
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well, the guy was here illegally.
serves him right. 
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Comment by sara on 5 November 2008:
I am a renter. I have paid my landlord almost forty thousand dollars since I have lived in this house. I just found out that my house is going up for sheriff sale in twenty days. I called my landlord and he denied everything. I think it is absolutely disgusting that I still have to pay him rent. I don’t care if he still technically owns the house. He more than likely is going to lose it. He has not lived up to his responsibilties on his end, paying the mortgage. So not only do I have to shove 1225.00 a month into his pocket for nothing I now have to come up with money to find a new place to live. I hope my tree in the backyard keeps growing all of those hundred dollar bills. Then to find out that landlords do not even have to give their tenants notice of this. Where is the humanity? Hello lawmakers there are thousands of us out there. I think you should speed up the process and put some laws on the books so these scumbags can be prosecuted. Thank you for reading this.