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Gotta love it! Landlord of 2 years told us today that he is being foreclosed on by the bank. His mortgage is $4400/month, and we pay him $1000/month less in rent. I guess that caught up to him.
He was trying for a loan modification, and was denied. With his terrible credit and market conditions, the nice man has to lose the place.
So, what happens to the 3 years left on my lease? My security deposit? Right to buy the house option? If the house does go into foreclosure as planned, will the banks allow us to stay? Do I have to deal with a million people knocking on the door in the next month? I hate visitors!
I kept this here in Raleigh because of the locality of real estate and weird stuff that goes along with it.
By the way, the landlord did a credit check on me. I should have done the same on him, too. Then again, so should have the real estate brokers who leased the place with him that arent returning calls right now.
I should have also mentioned, a sheriff delivered an auction notice while the landlord was working on the loan modification. Its set for "auction" on the Wake County block in June, unless that goes away.
In a nutshell, even if home is foreclosed, you can stay in the home until the end of your lease. However, if someone buys the home from the foreclosing bank with the intention of occupying it, then they can terminate your lease after giving you 90 days notice. There may also be state laws affecting your situation, suggest you consult with an attorney.
Must be a hell of a nice place for $4,400 a month. Personally I would try and work out some kind of cash for keys type deal. That might be your best bet to get moving costs out of the deal.
In the future, with an option, yes you'd want to check the credit of the person you're paying money to. Also, it's a good idea to hire a 3rd party management company to pay your money to so that party will pay the lender before paying any money to the owner. You have a vested interest in knowing the financials when you have an option on a property. Seems like you were totally unaware of what was going on with a property that you had optioned. Not a good way to do it.
Did you have a 5 year lease? Was this lease and option recorded at your county's register of deeds?
That caught my eye too, I can't say I ever heard of a 5 year lease. I thought leases were renewed yearly. Seems like an awfully big commitment to sign a 5 year lease.
Leases have to be recorded in MD if they are longer than 7 years. Not sure about the OP's locale.
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Then again, so should have the real estate brokers who leased the place with him that arent returning calls right now.
