September 28, 2018 | Share

The Place You Rent is in Foreclosure. Now What?

You have been a great tenant for years. You pay your rent on time each and every month and treat your landlord’s property as if it were your own. Now the unthinkable has happened. The place that you call home has gone into foreclosure.

You are left wondering if you are going to be evicted. If you are allowed to stay in your place will the landlord maintain the property? You’re not even sure where to send this month’s check.

What are your rights as a tenant in these circumstances?

Your Rights and Responsibilities as a Bona Fide Tenant in a Foreclosed Property

The law in Massachusetts is on your side, but that still might not be enough to get you over some of the hurdles of living in a foreclosed upon building.

As long as you moved into the property prior to the foreclosure, are not related to the former owner, and were not in a business or personal relationship with your former landlord, you are considered a bona fide tenant under Massachusetts law.

As a bona fide tenant, you cannot be evicted from your rented home just because the property is in foreclosure. Much the same as with any scenario where property ownership changes hands, you have the right to remain until the end of the lease period as long as you continue to meet your responsibilities as a tenant and follow all the lease conditions, including paying rent on time. But that might not be as simple as it sounds.

You need to make sure that you pay the rent to the proper party and, after a foreclosure it can be hard to identify the new owner. Even though the foreclosed owner is required to provide information regarding the new owner to the tenants, this often doesn’t happen. The tenant ends up either sleuthing it out on their own by researching court documents and records, or setting up a dedicated bank account and depositing the rent checks there until the new owner can be found, hoping this will suffice to show good faith in making timely rental payments.

Your lease may provide that you are entitled to certain utilities and amenities, like water, heat, and lighting in common areas. However, these may have been shut off due to failure to pay. You can report this to the new owner (if you can find them) or call the city government, but you may need to go to court to get the new owner (probably a bank) to pay the utilities. Depending on your circumstances you may be able to pay the utility bills and get services reconnected and then deduct these amounts from the rent while you are sorting out who is supposed to pay what.

Getting Your Security Deposit Refund After Foreclosure

In addition, you could run into difficulties getting a timely refund of your security deposit.

Security deposits are supposed to be placed into an interest-earning account by the building’s owner. You can start by sending a demand letter to your former landlord seeking the deposit back, but in reality you will likely end up having to contact the new owner to seek your refund or seeking the assistance of an experienced Boston tenant lawyer.

Contact a Boston Tenant Lawyer at the Law Offices of Shaun A. Hannafin

If you have questions about how to protect your rights when your landlord is in foreclosure, we encourage you to contact us by phone (617) 848-4572 or request an appointment online today.

Posted in Landlord-Tenant Information