PROTECTING TENANTS AT FORECLOSURE ACT
FACT SHEET
On May 20, 2009, a new federal law took effect, which provides protections for renters living in foreclosed residential properties (Public Law 111-22; Title VII- Protecting Tenants at Foreclosure Act). The Act is part of the Helping Families Save their Homes Act of 2009. It provides residents with at least 90-days in order to vacate. The act applies to every residential lease in the country.
One of the Utah law requirements when a property will be sold by the trustee through the foreclosure process, is that a notice of foreclosure sale has to be posted in some conspicuous place on the property at least 20 days before the date the sale is scheduled (57-1-25). The notice for foreclosure sale is not an eviction notice. Prior to the new federal law, Utah didn’t address specifically these types of evictions. A lease was voided once the property was sold through foreclosure.
The new federal law requires the following:
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Provide bona fide tenants with 90 days notice prior to eviction and
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Allow bona fide tenants with leases to occupy the property until the end of the lease term except the lease can be terminated on 90 days notice if the unit is sold to a purchaser who will occupy the property
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The notice applies to term leases and to month-to-month oral/written leases
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The successor in interest (generally the purchaser) has to honor the lease agreement they took over
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The successor in interest has to continue to honor the contract with the Housing Authorities for the Section 8 rental voucher recipients
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Both renter and successor in interest have to respect the lease agreement, and the rules and regulations of the property
If you are a renter:
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You must receive an eviction notice if the property undergoes foreclosure. Notice of foreclosure sale doesn’t constitute eviction notice
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Even if you have a month-to-month oral agreement with the property owner, you must receive a 90-days notice
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If you receive a notice of foreclosure sale or eviction notice due to foreclosure, contact immediately the responsible party to ensure where to send the rent payment.
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You should also provide them with a copy of the original lease. If there is no lease, provide them with copies of your checks or money orders of the previous rent payments.
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Click HERE to download the notice you should give to the property owner or to whomever (bank or attorneys/trustees) sends you the foreclosure sale notice so they will know what kind of proper notice you must receive as a renter
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If you are a Section 8 rental voucher recipient, click HERE to download the notice you should give to the property owner or to whomever (bank or attorneys/trustees) sends the foreclosure sale notice. You also should contact the housing authority that pays for your voucher. Click HERE to see a list of housing authorities in Utah
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If you are a Section 8 rental voucher recipient, keep constant communication with your housing authority. They are your best resource to help with issues arising living in properties undergoing foreclosure
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If you receive an improper eviction notice or if you think your renter’s rights are not respected you can hire an attorney, try to find a pro-bono one, OR you can file yourself a claim at the Small Claims Court. For a list of Utah’s courts, please click HERE
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Based on your income, you may qualify for free legal services through Utah Legal Services (ULS). You can also download the Renters’ Handbook provided by ULS
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You must continue to pay your rent!
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If your checks return, you don’t know where to send the payment, or you can’t make contact with any responsible party of the property, you can always open up a saving account and deposit the rent money. Remember, if you don’t pay your rent or if you will not have available immediately past due rents, you can be evicted in 3-days
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If you pay your utilities directly to the owner, you should check with Rocky Mountain Power and Questar Gas to make sure utilities won’t be cut-off just because the property owner doesn’t care anymore about paying the bills
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You may qualify for payment assistance for your utilities. Please contact Utah’s State Energy Assistance & Lifeline (SEAL)
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You should also contact your local municipality to find out who is the water provider for the property.
More information, letters to judges, letters to renters and from renters to property owners can be accessed on the National Low Income Housing Coalition Web site.
National Housing Law Project created the information that advocates are using to spread the word about the new law.
Please be advised that even if the federal law provides most needed protections, each state has different laws regarding foreclosure, contract law, or landlord/tenant issues. Each state for example has different time periods for eviction due to non-payment of rent. In Utah is 3 days.
For more information on Utah’s landlord/tenant law please visit Utah Legal Services Web site.
