Posted on Monday, July 13, 2009
May 20th the President signed an amendment to Helping Families Save Their Homes designed to help families who happen to be tenants save their homes, at least for a short time, too. The amendment requires investors and lenders who acquire title to foreclosed residential rental property to allow the tenants to stay for the full term of their lease as long as they pay they’re paying their rent. Tenants with no written lease can stay 90 days after the foreclosure. The law will be in place until 2012 unless extended. Until now many residential tenants were not getting any notice that their home was in foreclosure until the bank or new owner knocked on the door to evict them. This even though most states require tenants be noticed as part of the foreclosure process itself. While this new law will help tenants plan better, it creates new obstacles for bank and may drive prices down further since some investors won’t be willing to buy properties they cant take immediate full control of, especially if the rental rates are considered low.