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My landlord has stopped making his mortgage payments and the bank has now filed a default. What are my options. I have been told I should withhold the rent now due and deposit it into an account at my bank. The landlord is holding a security deposit equal to two months rent. I don't want to do anything that would affect my credit as I may want to purchase home in the near future. The landlord has placed the house on the market for sale last month but his asking price is about 50% over market value. He is upside down about 50%
I had a friend who was renting across the street from me. She discovered from the bank that the owner was foreclosing on the house. When she called and consulted him, he denied it. A couple weeks later, she recieved notice of when the house needed to be vacated. She called again and he still denied it. She stopped paying rent and saved her money to move into another rental. She did clean it and do the minor repairs necessary to the home when she moved out when the vacate notice indicated...all the while the owner wasn't owning up to what was going on. She didn't have the money to go after him for her security deposit and she knew he wouldn't have it to give to her. So, she lost out on it but moved on. The lucky part is she was able to save 2 months of rent to prepare for another rental.
Sad story but true.
I would talk to you landlord (use the word landlord lightly) and start paying your rent at the end of the month that way you only pay for the time you live there. Even though he cannot spend the deposit legally he probably spent your deposit already so good luck getting any of that back
If you have an attorney friend, ask them. The courthouse or bank may be another good place to go.
Do not just stop making your payments! Even if you go the court route, they will likely require you put money into escrow until the issues can be resolved.
By doing so the LL can still go to get a judment against you and it can ruin your credit score...it sounds unfair but it is according to the law, non of your business what the LL does with your rent, but according to the law you have to pay it.
Soon in Fl. there will be a law that requires LL for signing a paper stating they are up to date on their mortgage and have no liens before renting out their property. From the time the mortgage isn't paid until foreclosure it will take more than 1 year and no lease agreements are allowed loner than a year so no tenants should face being evicted due to the LL no paying the mortgage. So every year the paper needs to be signed
The last lease expired more than two years ago. The rent money is in a separate account and can be paid if and when necessary. The LL told me last week that they just decided to stop paying the mortgage a few months ago. I found out about the default on my own. They are trying to short sell to keep from messing their credit and expect me to make the house available to show to prospective buyers and agents. But they are way way over priced. They have plenty of money and could afford mortgage if they really wanted. This is just been a bad investment for them. Meanwhile the bank can if they want foreclose at any time.
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