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How does this work?
The listing is either corporate owned or bank owned, that's still up in the air.
One listing says CO and the other BO.
Anyway, if we do make an offer and it is accepted, how does the 'renter' situation work out?
Will they have a certain time frame in order to leave? If so, how long is that typically?
We are not in a rush at all....btw.
And, how do you make sure the renter doesn't do damage when they leave and would you still be obligated to buy if they trashed it?
How do you deal with this dilemma?
Thanks.
There are all sorts of approaches to dealing with an existing tenant.
Ideally, they are responsible people and pay a fair rent in full...
and are generally worthy of what rights they might have to remain under the terms of the lease they have now.
And then there is the semi-organized extortion known as: "Cash for Keys"
It works.
In Georgia, the lease goes with the sale - i.e. new owner has to honor the current lease. And yes, if they trash the place on the way out (if they go on time!) you're responsible.
You've got to put in a lot of 'cover your arse' stuff when tenants are in place.
My buyer submitted an offer on a home with a tenant in, that was to be moving by July 1st, so we put closing date to be after that - solves a LOT of problems!
It sounds like the property has possibly already been foreclosed on. If that is the case, and it is bank owned, the tenants might or might not be covered by the "Protecting Tenants at Foreclosure Act of 2009", so look into that.
If it is currently corporate owned and coming up on foreclosure (you intend to buy it at the auction), then you are expected to honor the lease, or buy them out.
Do you want to keep tenants after you own the home? If your intention is not to be a landlord, then I would agree, the best plan is to have the tenants out before closing, and have a contingency that you can walk away if they do significant damage at move out, so you get the opportunity to approve condition before signing.
UPDATE:
Due to his latest refusal to let my realtor take pictures....the bank has as of today, taken the home off the market. Apparently to evict this tenant even though they assumed his lease. I guess they have enough documentation against him? Or maybe a combination of things against him? (late rent etc)
Is this going to be hard for the bank to do? (evict)
UPDATE:
Due to his latest refusal to let my realtor take pictures....the bank has as of today, taken the home off the market. Apparently to evict this tenant even though they assumed his lease. I guess they have enough documentation against him? Or maybe a combination of things against him? (late rent etc)
Is this going to be hard for the bank to do? (evict)
Depends on the eviction law in your state, and what the tenant's lease says, and when in the eviction process the tenant moved in.
If the tenant is covered under the Protecting Tenants at Foreclosure Act of 2009, the bank cannot evict him with less than 90 days notice, even on a month to month lease, unless he isn't paying rent.
If he isn't covered under that act, I believe they can give 30 days notice to vacate, even if he is in a lease.
If he isn't paying rent, then it depends on eviction law in your state, and how long that takes.
However, if they offer him cash for keys, and he accepts, then it may be easy to get him to move.
[quote=Lacerta;19288745]Depends on the eviction law in your state, Georgia and what the tenant's lease says, and when in the eviction process the tenant moved in. Not sure...think he's been there before foreclosure was completed, maybe even was there while/before preforeclosure was in effect.
If the tenant is covered under the Protecting Tenants at Foreclosure Act of 2009, the bank cannot evict him with less than 90 days notice, even on a month to month lease, unless he isn't paying rent. what would make him exempt from the 2009 law? wouldn't he be covered under it as would everyone else in the US? or could his state (GA) choose not to go by the law?
If he isn't covered under that act, I believe they can give 30 days notice to vacate, even if he is in a lease.why wouldn't he be covered? I'm not educated on this law!
If he isn't paying rent, then it depends on eviction law in your state, and how long that takes. anyone know GA's eviction laws?
However, if they offer him cash for keys, and he accepts, then it may be easy to get him to move.If I am correct, he was offered cash for keys and refused. [/quote]
Boy what a mess! The realtor office told me this morning that she was going to keep in touch with my realtor, and that they were taking it off the mkt to 'deal with the renter'. SHe knows we are extremely interested in the home, and aren't ready to move until after the end of the year, so we have all kinds of time. But now, we are glad the house is off the mkt, glad that this didn't go any further with us having to deal with this renter!
How does this work?
The listing is either corporate owned or bank owned, that's still up in the air.
One listing says CO and the other BO.
For some reason, Fannie Mae properties being listed here near Sacramento all have "Corporate Owned" in the description. Not sure why because they are clearly bank owned. Maybe they think it will deter people looking for a below market bargain buy or deter squatters from moving in. Any realtor can do a quick look and see it's REO.
If the tenant is covered under the Protecting Tenants at Foreclosure Act of 2009, the bank cannot evict him with less than 90 days notice, even on a month to month lease, unless he isn't paying rent. what would make him exempt from the 2009 law? wouldn't he be covered under it as would everyone else in the US? or could his state (GA) choose not to go by the law?
If he isn't covered under that act, I believe they can give 30 days notice to vacate, even if he is in a lease.why wouldn't he be covered? I'm not educated on this law!
It definitely does not cover all tenants. What it says is that if a tenant is in an arms length lease (ie not renting from family) that is at market rate (ie not renting a 1500 square foot house for $100/month), and were in the lease prior to when the notice of default (or local equivalent) was filed, THEN they are covered. So lets say that the owner stopped paying in January, and the NoD was filed in March, and the house foreclosed in September. In that case, a lease signed in February or sooner would be covered. A lease signed in April or after would not. A lease signed in March would be questionable, and would likely be disputed by the foreclosing bank.
So if he is covered, and the lease still has time left on it (unlikely unless it was longer than a year lease or the foreclosure happened quicker than average), they have to honor the lease as long as he pays rent and is following the rules of the lease, unless he agrees to a buyout.
If he is covered, and the lease is now month to month, they have to give 90 days notice, unless he agrees to a buyout.
If he isn't covered, the bank considers the lease to have been entered into not in good faith, and they do not usually honor them. They typically give the tenant 30 days notice to move and do not offer any buyout.
For more discussion on this federal law, google "Protecting Tenants at Foreclosure Act of 2009" and you will find a ton of information.
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