The house I lease is up for auction...

Beaverton, OR · Member since 2014 · 3 posts · 2 votes

I have a year left on my lease and I have not missed a payment to owner even though she was in default. Will I be kicked out the day after the auction if someone buys it? I'm worried the sheriff will lock me out and I will lose all my belongings! Very nervous.

Derek

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Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

12y

@Derek Moya

@Account Closed

Joe is correct on the owner occupied.. however as I was one of the larger foreclosure buyers in this county for going on 10 years I probably will know who bought your home if it indeed sells 3P

And most likely its a Judicial foreclosure as Oregon through out TD sales ( all thought those are coming back).. Go Right over to Hillsboro to the county court house walk into the recorders office and record your lease.. this will give constructive notice and it will cloud the title. along with the 6 month right of redemption ( now many of the guys I know will buy redemption rights up front) this may not be the case.. And again unless as Joe states someone buys it to live in ( Very RARE) if you have a bona fide lease at market rate.. the new purchaser is bound to the lease.. And not to worry only about 5% of homes that go to auction are sold 3rd party. .You will probably be dealing with the asset manager or bank that took it back.. They won't give you a hard. time..

However as I stated recording the lease cost you 20 bucks or so but will all but assure you your tenancy through the term.. Not many title companies or any will write around that exception and give clear title.

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Account Closed
Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
12y
@Greg Hall,
I am a landlord friendly not tenant friendly. Greg I guess they have wild justice in your area but here in Dallas the judges make the decision, and the judges do not like dead-beat tenants at all, but no one has protested against the judges here.

Joe Gore
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Account Closed
Homeowner · Pittsburgh, PA · Member since 2014 · 854 posts · 511 votes
12y
This the reaction I picture when @Account Closed tells his judge friend about the legal arguments he engages in on the internet.
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Derek Moya
OP
Beaverton, OR · Member since 2014 · 3 posts · 2 votes
12y
Thank you so much everyone! I do have a lease and I was contacted by an investor who said the sheriff could lock me out if they wish. I think they wanted to bully me. I appreciate all your responses. I have continued to make payments to the owner even knowing they were in foreclosure and plan to pay the new owner as long as my lease requires.
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Account Closed
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
12y
Originally posted by @Rick H.:

Jay Hinrichs - I'm Cali-centric, it's true, but wouldn't a lease recorded after a trust deed be extinguished by the act of the senior lien going to sale?
The Protecting Tenant's in Foreclosure Act makes the need for a recorded lease moot. A properly executed lease, regardless of whether or not it's recorded, does not get wiped out at trustee's sale in CA, as long as the lease was executed prior to the "notice of foreclosure". Case law in CA and additional federal legislation has gone on to define "notice of foreclosure" as the date of trustee's sale. Not the "notice of default" and not the"notice of trustee's sale". So a landlord and tenant can execute a lease right up until the property sells at foreclosure sale and it's binding on the buyer. Except in the case of a primary residence buyer, who can terminate the tenancy with a 90 day notice per the federal law. The lease has to be less than 3 years (or maybe 2?), and for market rent. The tenant has to be a bonafide tenant and not the borrower nor the borrower's family members.
This law goes through the end of 2014. We'll see if it gets extended.......
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Account Closed
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
12y
Originally posted by @Derek Moya:

Thank you so much everyone! I do have a lease and I was contacted by an investor who said the sheriff could lock me out if they wish. I think they wanted to bully me. I appreciate all your responses. I have continued to make payments to the owner even knowing they were in foreclosure and plan to pay the new owner as long as my lease requires.
I hate to hear of investors telling tenants things like that. There will be no lockout after the sale. There's no lockout period, as long as you pay rent and honor the terms of your lease agreement. Lockouts happen at the end of the legal eviction process which is a court case. But you're not going that route. You're planning to pay rent and want to live out the terms of your lease. If and when you hear from the new owner, whether it's the lender getting it back or a new owner, you will make arrangements to pay rent to them.
Indeed, even though the owner is in foreclosure, she is owed rent and can evict for non payment. She's still the owner. Foreclosures can go on for years and may not even happen as the payments or debt issue may get resolved. Hence a pending foreclosure is not a good reason not to pay rent.
Are you aware of an actual auction date? Have notices been posted at the property, or have you received anything in the mail? You should be able to monitor whether or not the auction gets held as scheduled and what happens. There are probably people on BP in your state who can help you decipher the notices so you can stay on top of the situation.
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Hattie Dizmond
Investor · Dallas, TX · Member since 2014 · 2k+ posts · 1k+ votes
12y
@Derek Moya
I'll let the boys fight it out about the legal matters. Personally, I think that's quite funny, since I don't think any of them are lawyers!
Regardless, the initial responses you received should be correct, in that, if you have a signed Lease, you should be protected for the remaining term of the lease. Additionally, if the new owner intends to not allow you to renew or to significantly increase the rent on a new lease term, they are generally required to provide you the same notice period they require from you...usually 30-days. The one caveat I would note is that landlords can and sometimes do include out clauses to cover themselves in the event they decide to sell the property. That happened a lot, during the recent crash, when relocating homeowners were renting their homes, because they had been unable to sell them. They would include a clause allowing them to give you reasonable notice of the sell and require you to vacate. If you don't have any out clause for the landlord, you're probably ok.
All that being said, here in Texas there are Tenant organizations in the major markets that help with these types of issues. I'm sure there are probably similar groups in OR. If this is a major concern for you, I would recommend you seek out one of those groups and/or contact your local Legal Aide society, as both resources can give you specific answers and even legal opinions from real lawyers! :)
Hattie
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Geode Pratt
Investor · McKinney, TX · Member since 2011 · 35 posts · 9 votes
12y
Wow! I clicked on this thread thinking it would answer a question I have about purchasing an occupied property. For a minute there, I thought it took me to Facebook instead.
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Derek Moya
OP
Beaverton, OR · Member since 2014 · 3 posts · 2 votes
12y
There is an auction date 8/11. I have all my rent receipts and my lease. Its a 3 year lease which was 3 years because I was going to have an opportunity to purchase the home, well I thought I would have an opportunity. I will monitor it on the sheriff's web site and keep paying my rent no matter what. I'll post updates as to what happens. Thank you1
1 Reply
Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
12y
@Derek Moya
if you can get to the sale you should go its at the Washington county sherrifs office in Hillsboro and see if an investor actually buys it.. If it reverts ... then it will be some time before you hear anything.
@Account Closed
as K says and others the Oregon law is on your side in this instance.. Its why many in the bizz will not buy an occupied house in this environment. And why they have contacted you and threatened you.
Recording a lease in Oregon though is a powerful tool, I know that first hand. .If I was leasing a property it would be the first thing I did
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Account Closed
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
12y
Originally posted by @Jay Hinrichs:

@Derek Moya
if you can get to the sale you should go its at the Washington county sherrifs office in Hillsboro and see if an investor actually buys it.. If it reverts ... then it will be some time before you hear anything.
@Account Closed
as K says and others the Oregon law is on your side in this instance.. Its why many in the bizz will not buy an occupied house in this environment. And why they have contacted you and threatened you.
Recording a lease in Oregon though is a powerful tool, I know that first hand. .If I was leasing a property it would be the first thing I did
That threatening thing really sucks. Like investors and rehabbers don't already have a bad reputation and plenty of bad PR. A prospective auction buyer who contacts a bonafide tenant and lies to them about the eviction process? IMO, they deserve to get the property occupied by a tenant with a recorded and properly executed 2 year lease. Let them buy out the tenant or keep them at market rent for 2 years. Maybe the OP should go back to the landlord and get a new lease and record it before the sale.
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Account Closed
Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
12y
@K. Marie Poe,
Can you show me where a lease been recorder in the state of California or any state I like to see it?
Joe Gore
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Steve Babiak
Real Estate Investor · Audubon, PA · Member since 2009 · 13k+ posts · 8k+ votes
12y
Originally posted by @Account Closed:

@K. Marie Poe,
Can you show me where a lease been recorder in the state of California or any state I like to see it?
Joe Gore
Joe,
Stop being such a troll. K. Marie never said to record a lease; in fact she said it was unnecessary (that's what the word "moot" means). Here is a quote from her relevant post:
"... The Protecting Tenant's in Foreclosure Act makes the need for a recorded lease moot. ..."
And I almost forgot Joe - Greg Hall is still waiting for you to provide case law in this other thread:
http://www.biggerpockets.com/forums/52/topics/1388...
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Account Closed
Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
12y
@Steve Babiak,
I am glad you jump in with your uneducated smart remarks. Look who is calling someone a troll.

Joe Gore
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Account Closed
Homeowner · Pittsburgh, PA · Member since 2014 · 854 posts · 511 votes
12y
@Account Closed
How did your lunch with Judge Joe Brown go yesterday?
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Account Closed
Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
12y
@David R.,
The lunch went very well are you trying to be funny on a Friday afternoon.
Joe Gore
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Account Closed
Homeowner · Pittsburgh, PA · Member since 2014 · 854 posts · 511 votes
12y
@Account Closed
My Friday afternoon is long gone. After midnight here.
As for being funny, it is a gift that requires no effort on my part.
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Steve Babiak
Real Estate Investor · Audubon, PA · Member since 2009 · 13k+ posts · 8k+ votes
12y
Originally posted by @Account Closed:

@Account Closed
...
As for being funny, it is a gift that requires no effort on my part.
Especially when the subject is ________ ....
You get one guess to fill in the blank ...
I will vote up posts that give the correct answer :)
Hey Joe Gore, you look like you could use a vote ...
:)
1 Reply
Account Closed
Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
12y
@Steve Babiak,
I am not running for office but I could used a vote.
Joe Gore
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Account Closed
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
12y
Originally posted by @Steve Babiak:

Originally posted by @Account Closed:
@K. Marie Poe,
Can you show me where a lease been recorder in the state of California or any state I like to see it?
Joe Gore
Joe,
Stop being such a troll. K. Marie never said to record a lease; in fact she said it was unnecessary (that's what the word "moot" means). Here is a quote from her relevant post:
"... The Protecting Tenant's in Foreclosure Act makes the need for a recorded lease moot. ..."
And I almost forgot Joe - Greg Hall is still waiting for you to provide case law in this other thread:
http://www.biggerpockets.com/forums/52/topics/1388...
I don't know how missed this. Indeed I said for the purposes of the PTIFA there's no need to record a lease (but it couldn't hurt, IMO). A properly executed lease with a bonafide tenant and a market rent is binding on an investor buyer at foreclosure sale. As for recorded leases in CA, you can look them up in any county here where the recorder allows you to search by document type. In fact, I recorded one in 2012 (as the grantor). I resold the property and recorded a lease termination in 2013.
Surely you must know that leases are recorded all the time. Commercial leases, land leases, oil leases. Options to buy SFHs with lease agreements are sometimes recorded as well. Like I said, look them up.
1 Reply
Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
12y
@Account Closed
Yes and farm leases and nursery stock leases .. And anyone in our state going to an attorney for the prep of a lease option to purchase would be given the advice to record it.
And my favorite Timber Deeds of which I traded in during the great logging days of the 90s here in Oregon.
By recording the lease if there is a foreclosure the Trustee will have to notify the holder of the lease of the foreclosure just like any other lien or person with an interest in the property.. If more people recoreded leases they would not wake up one day and realize their house was going to go to foreclosure in a week.. they would know right at the start and have some ability to help with the situation.. Kind of like on a All inclusive DT in CA you have the right to pay the first if the person who wrapped you failed to make it.. At least the ones I did in the 80's in CA had a place right in the All inclusive DT for the bene's info.
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JLH Capital Partners51 Review
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