Bought foreclosure with tenants...what to do?

Ok folks, I bought a quad at foreclosure auction that currently has tenants in 3 of the 4 units. What do I do with the tenants? Does the change in ownership affect the lease signed with previous owner? Should I post and/or mail notification of new ownership (send your checks to me)? Do I evict at end of lease or if tenant can't produce a lease? Just spitballing here and am interested to hear what everyone has to say. Some facts:

- I am in South Carolina
- I have read the SC Landlord Tenant Act to no avail
- I have searched the forums, also to no avail
- My "mentor" has no experience in the situation
- Spoke with foreclosure attorney - said to evict them and told me which magistrate to go see

I look forward to your replies.

Shaine

Zac P.

Real Estate Investor · Lexington, Kentucky

31 posts

Feb 04, 07:05 PM

From what I know, I am pretty sure the lease goes with the property- not the owner. So based off of that, you would have to have a good cause to evict them.

Shaine Cobb

Real Estate Investor · South Carolina

31 posts
1 award

Feb 04, 07:14 PM

Thanks Zac P. I think that you're probably right, and if they are paying tenants I'm in no hurry to get rid of them. Just need to make sure they're paying the right person - me.

Huggy Baird

· Lakewood, Ohio

68 posts
1 award

Feb 04, 07:14 PM

You will have to honor their lease. Without a lease you'll need to give 90 days notice. Google the Foreclosure Tenant Protection Act for all the rules and possible exceptions (eg if the rent is below market value or they are family members of previous owner

In addition to that law, you'll have to check local or state ordinances

Good luck

Shaine Cobb

Real Estate Investor · South Carolina

31 posts
1 award

Feb 04, 07:15 PM

Thanks Huggy Baird. I will start reading right away.

Jennifer Lee

Real Estate Investor · Gibsonia, Pennsylvania

278 posts
1 award

Feb 04, 07:28 PM

I saw ur post earlier but didn't want to comment bc I don't know about foreclosure.

But I'm thinking u already got 3 out of 4 tenant. If they are paying u can hold off any renovations.

I bought a commercial retail with tenant. I spoke to them, they didn't want to move, practically begged me to buy it bc I'll keep 'em.
I asked for lease. It was landlord friendly ;) and they have been in business there 4 yrs. I just honored that lease. Retyped it, change names and date. Kept rent bc they signed for 2 more yrs ;). Bc commercial vacancy is more than yr. And the price was too good to pass.

Shaine Cobb

Real Estate Investor · South Carolina

31 posts
1 award

Feb 05, 03:38 PM

Jennifer,

Hopefully, I will inherit some decent tenants too! I just am not sure how to go about letting them know that I am the new owner. I hope to keep them if they will agree to the new leases. I would hate to incur a vacancy if it's not needed. Thanks for the insight.

Shaine

Jim Q

· Carlsbad, California

32 posts
1 award

Feb 05, 05:31 PM

You should find out if the tenant paid deposit or not. If so, you need to recover it from the previous owner, because you're supposed to return them (after all the repairs) back to the renters after they move out.

Shaine Cobb

Real Estate Investor · South Carolina

31 posts
1 award

Feb 05, 06:04 PM

Jim Q,

That would be ideal. I just assumed that since the property was a foreclosure that the original owner would not be interested in sharing with me - deposits, leases, tenant info, etc. I have their info from the property records, I guess it wouldn't hurt to contact them. Do you know if they are required to sign over deposits. Do I have recourse if they won't? Thanks for the idea!

Shaine

Jim Q

· Carlsbad, California

32 posts
1 award

Feb 06, 12:10 AM

What you can do really depends on the lease already in place. You should get hold of the lease. If one doesn't exist, you should sign new ones with the tenants. The standard CA lease says the agreement is with the owner who should keep the deposit. So technically if the tenant paid it, you're responsible for giving them back.