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Additional State and Local Protections for Tenants in Foreclosure Situations
Even before the enactment of the Protecting Tenants at Foreclosure Act (PTFA), state and local governments had turned their attention to tenants’ rights after foreclosure. Since the PTFA does not preempt state or local laws that provide greater protections to tenants, many states have continued to legislate substantial additional protections for tenants.
These state law responses to the effect on tenants of the foreclosure crisis have varied and include providing tenants in foreclosed properties with increased notice before eviction, requiring entities that purchase property at foreclosure sales to maintain the property, requiring utility companies to continue to provide utilities post foreclosure, and requiring the new owner to be responsible for the tenant’s security deposit. In addition, in jurisdictions requiring just cause to evict, state and local laws have been interpreted to prevent eviction due solely to a foreclosure and, recently, have been expanded to cover all foreclosed upon units.
Alaska (primarily non-judicial foreclosure through power of sale in deed of trust)
Pre-Foreclosure Sale Notice to Tenants (Alaska Stat. § 34.20.070)
Within 10 days after recording the notice of default, the trustee must mail a copy of the notice by certified mail to any person in possession of or occupying the property.
Arizona (primarily non-judicial foreclosure through power of sale in deed of trust)
Disclosure of Foreclosure to Prospective Tenants (H.B. 2766 effective 7/29/10)
Arizona requires a landlord to notify prospective tenants if the property is being foreclosed upon. If the owner fails to comply, the tenant may recover damages and seek injunctive relief. The law does not cover multifamily properties of four or more units.
California (primarily non-judicial foreclosure through power of sale in deed of trust)
Pre-Foreclosure Sale Notice to Tenants (Cal. Civ. Code §§ 2924.8, 2924b(c)(2)(D))
In California, a trustee is required to post and mail a notice of trustee sale at least 20 days before the foreclosure sale. The pre-foreclosure notice informs tenants that they must receive 60 days’ notice if the post-foreclosure owner wants to evict them after foreclosure, and that other laws may prohibit eviction or give longer notice before eviction. The section expressly provides that it applies only to “loans secured by the residential real property and if the billing address for the mortgage is different than the property address.”
A tenant with a recorded lease is also entitled to receive a copy of the notice of default within one month after the notice of default is recorded.
Utility Shutoff Protections (Cal. Pub. Util. Code §§ 777, 777.1, 10009, 10009.1, 12822, 12822.1, 16481, 16481.1)
California law provides that utilities must give notice to non-subscriber residential users of electrical, water, heat and/or gas in individually metered and master-metered units of multifamily buildings prior to extinguishing those utility services. Occupants are allowed to become customers of the utility corporation or public utility and allocate rent payments to maintain services.
Senate Bill 120 expands these protections by (1) extending utility shutoff protections to tenants in single-family homes (10 days notice or 7 days if the utility is investor-owned); (2) requiring notices of utility shutoffs to be in writing; and (3) requiring the shutoff notices to be in Spanish, Chinese, Tagalog, Vietnamese, and Korean in addition to English. The new protections take effect on January 1, 2010, except for tenants in single-family homes served by an investor-owned utility, in which case the new provisions apply on July 1, 2010.
Good Cause Eviction Protection (Berkeley Municipal Code § 13.76.130)
Under the “good cause for eviction” provisions in Berkeley’s Rent Ordinance, good cause is required to evict tenants from most properties in Berkeley.
Good Cause Eviction Protection for Rent-Controlled Units (Beverly Hills Municipal Code Chapters 5 and 6)
Good cause is required to evict from rent-controlled units in Beverly Hills.
Good Cause Eviction Protection for Rent-Controlled Units (East Palo Alto Municipal Code § 14.04.290)
Good cause is required to evict from rent-controlled units in East Palo Alto.
Good Cause Eviction Protection (Glendale Municipal Code § 9.30.030)
Good cause is required to evict from most rental units in Glendale.
Good Cause Eviction Protection for Rent-Controlled Units (Hayward Residential Rent Stabilization Ordinance)
Good cause is required to evict from rent-controlled units in Hayward.
Good Cause Eviction Protection (Los Angeles Municipal Code ch. IV, art. 14.1, § 49.92)
In Los Angeles, good cause is required to evict from rent-controlled properties, and foreclosure is not a good cause to evict. A recently enacted ordinance temporarily extended the good cause requirement to non-rent controlled properties acquired through foreclosure.
Good Cause Eviction Protection (Maywood Municipal Code § 8.17.030)
In Maywood, good cause is required to evict tenants from most units.
Good Cause Eviction Protection (Oakland Municipal Code § 8.22.360)
In Oakland, tenants cannot be evicted without just cause.
Utility Shutoff Protections
The Oakland city attorney declared in December 2008 that termination of utilities will automatically be deemed a significant threat to health or safety in tenant-occupied foreclosed properties where the former owner was responsible for utility payments. The city attorney’s declaration grants tenants 120 days after the notice of utility shutoff to locate their new landlord, assume payment, or make other arrangements. The declaration is effective until the end of 2010.
Good Cause Eviction Protection (Richmond Municipal Code § 7.105.020)
Richmond law prohibits post-foreclosure owners from evicting tenants without good cause.
Good Cause Eviction Protection (Ridgecrest Municipal Code § 4-25.103)
Ridgecrest law prohibits post-foreclosure owners from evicting tenants without good cause.
Good Cause Eviction Protection (San Diego Municipal Code § 98.0730)
Residential tenancies of more than two years duration may not be terminated except for cause.
Good Cause Eviction Protection (San Francisco Admin. Code § 37.9)
In San Francisco, good cause is required to evict from rent-controlled properties, and foreclosure is not a good cause to evict. Gross v. Superior Court, 217 Cal. Rptr. 284 (1985). A recently approved ordinance extends the good cause requirement to cover non-rent controlled properties acquired through foreclosure.
Utility Shutoff Protections
The San Francisco City Attorney, in conjunction with the Department of Building Inspection, issued a protective declaration that provides that no utilities shall be terminated in master-metered multiunit residential buildings, irrespective of foreclosure status. The San Francisco Declaration does not specify a time limit on tenants’ receipt of services before the termination. This declaration expires on December 31, 2010.
Good Cause Eviction Protection for Rent-Controlled Units (Santa Monica Rent Control Charter Amendment § 9002)
Good cause is required to evict from rent-controlled units in Santa Monica.
Good Cause Eviction Protection (West Hollywood Rent Stabilization Ordinance § 17.52.010)
West Hollywood prevents owners from evicting tenants without just cause. An exception exists for tenants in single family homes, where the landlord can evict if the eviction notice is given within 30 days of the foreclosure sale and relocation assistance is paid to the tenant.
Colorado (power of sale with limited court supervision)
Pre-Foreclosure Sale Notice to Tenants (Colo. Rev. Stat. § 38-38-103)
No more than 20 days after a notice of election and demand is recorded, the public trustee must mail a combined notice of sale, right to cure, and right to redeem to the occupant of the property, addressed to “occupant” at the property address.
Connecticut (judicial foreclosure)
Cash for Keys (Conn. Gen. Stat. § 47a-20f, as amended by Public Act 10-181 effective Oct. 1, 2010)
No mortgagee, lienholder or successor in interest can require a tenant to waive any legal rights or remedies in exchange for accepting an incentive to vacate the foreclosed property, with the exception of “the right to bring an action to reclaim a security deposit.” Incentives must be at least equal to the tenant’s security deposit plus interest, or, if no record of the amount of the security deposit exists (or if the tenant did not pay a security deposit), the tenant is entitled to two months’ rent, or $2,000, whichever is greater.
Good Cause Eviction Protection for Elderly or Disabled Tenants (Conn. Gen. Stat. § 47a-23c)
In Connecticut, good cause is required to evict elderly or disabled tenants from multifamily properties, and foreclosure is not a good cause to evict. First Fed. Bank v. Whitney Dev. Corp., 677 A.2d 1363 (Conn. 1996).
District of Columbia (non-judicial foreclosure through power of sale)
Good Cause Eviction Protection (D.C. Code § 42-3505.01)
D.C. law restricts landlord’s authority to evict protected tenant after foreclosure. Administrator of Veterans Affairs v. Valentine, 490 A.2d 1165 (D.C. 1985).
PTFA Compliance (Administrative Order 09-09 A1)
The Eleventh Judicial Circuit, a court that covers Miami-Dade County, issued an administrative order requiring all writs of possession issued after a judicial foreclosure to refer to PTFA and clarifying that the issuance of writs of possession is subject to provisions of PTFA.
Idaho (primarily non-judicial foreclosure through power of sale)
Pre-Foreclosure Sale Notice to Tenants (Idaho Code Ann. § 45-1506)
At least three good faith attempts must be made to serve a copy of the notice of sale “upon an adult occupant of the real property in the manner in which a summons is served.” Each time service is attempted, a copy of the notice of sale must also be posted in a conspicuous place on the property, unless a copy previously posted remains conspicuously posted.
Illinois (judicial foreclosure)
Notice requirements (735 Ill. Comp. Stat. § 5/15-1508.5)
A lender or purchaser who, as a result of the foreclosure, takes title at the confirmation of sale must, within 21 days, make a good faith effort to identify everyone who lives at the acquired property. During that same 21-day period, the lender or purchaser must also provide written notice by personal service or first-class mail to each known resident of the property informing him or her that control of the property has changed.
The notice must include: (1) the name and case number of the foreclosure case, and the court where the foreclosure case was pending; (2) the name, address, and telephone number of an individual or entity whom residents may contact with concerns about the property or to request repairs; and (3) the following language, or language that is substantially similar: “This is NOT a notice to vacate the premises. You may wish to contact a lawyer or your local legal aid or housing counseling agency to discuss any rights that you may have.”
The lender or purchaser is under a continuing duty to serve this written notice on any tenant that it learns is occupying the property, even if the tenant is discovered after the initial 21-day period. A truncated version of this notice must also be posted at the premises.
If a receiver (or mortgagee in possession) is appointed to operate and manage the subject property while the foreclosure case is pending, the receiver also has the duty to identify residents and serve them with a similar notice.
Tenant Protections during the Foreclosure Process (735 Ill. Comp. Stat. § 5/15-1704)
A receiver appointed by the court may not raise the rent of a month-to-month tenant without leave of court. Further, a receiver or mortgagee in possession must accept rental payments from tenants and HAP payments on behalf of voucher holders or other third-party rental assistance payments during the foreclosure case.
Record Sealing of Post-foreclosure Evictions (735 Ill. Comp. Stat. § 5/15-1701(h)(5))
In Illinois, eviction records of occupants “who would have lawful possession of the premises but for the foreclosure of a mortgage on the property” are sealed.
Foreclosure Notice to Tenants (Chicago Municipal Code § 5-12-095)
Chicago requires owners of properties facing foreclosure to notify all of their tenants in writing “that a foreclosure action has been filed against the owner or landlord.” Owners must also give written notice to “any other third party who has a consistent pattern and practice of paying
rent to the owner or landlord on behalf of a tenant.” If a tenant demonstrates that the owner or landlord violated this section, he or she is entitled to recovery of $200.
Disclosure of Foreclosure to Prospective Tenants (Chicago Municipal Code § 5-12-095)
Chicago’s Residential Landlord and Tenant Ordinance requires a landlord of a property undergoing foreclosure to provide written notification to prospective tenants that the landlord is named in a foreclosure complaint. If the owner fails to comply, the tenant may terminate the rental agreement with a 30-day notice.
Maine (judicial foreclosure)
Pre-Foreclosure Sale Notice to Tenants (Me. Rev. Stat. Ann. tit. 14, § 6203-A)
In Maine, a mortgagee must provide a copy of the notice of sale to tenant if the mortgagee knows or should know that the property is occupied as a rental unit. The notice may be served on the tenant by the sheriff or by mail at the tenant’s last known address.
Eviction Protection (Pub. Law 566 enacted Mar. 29, 2010)
A bona fide tenancy in a building for which a foreclosure action is pending or for which a foreclosure judgment has been entered may be terminated only pursuant to the provisions of the federal Protecting Tenants at Foreclosure Act.
Utility Shutoff Protections (Pub. Law 566 enacted Mar. 29, 2010)
If a landlord fails to pay for utility service in the name of the landlord, the tenant may pay for the utility service and deduct the amount paid from the rent due to the landlord.
Maryland (primarily power of sale with court supervision)
Tenants' Rights and Required Notices (Md. Code Ann., Real Prop. §§ 7-105.6, 7-105.9, as amended by SB 654 and HB 711)
Maryland’s recently revised statute applies to all foreclosures docketed on or after June 1, 2010. The legislation incorporates PTFA protections for bona fide tenants into state law without a sunset date and clarifies how these protections apply in Maryland. Additionally, pre-foreclosure sale, the statute requires the foreclosing entity to send notices to “occupants” twice prior to the foreclosure sale. Each notice must inform occupants that renters likely have the rights to lease survival and to receive a 90-day notice to vacate from the new owner.
Post-foreclosure sale, the revised statute provides that the 90-day notice to vacate may only be sent by the new legal title holder; it must be sent by first class and certified mail; and it must specify the date certain by which the tenant must vacate the property as well as the legal basis for termination. The statute clarifies that the 90-day notice and lease survival protections apply to all bona fide tenants who entered into leases prior to transfer of legal title to the foreclosure sale purchaser.
PTFA Compliance Check (Md. R. 14-102)
If the purchaser ascertains that a tenant resided in the foreclosed property after a reasonably diligent inquiry, the purchaser must give proof that a proper eviction notice under Protecting Tenants at Foreclosure Act has been given and that the tenant has no further right to possession before a court can entertain a motion to grant a judgment of possession.
Massachusetts (primarily non-judicial foreclosure through power of sale)
Just Cause for Eviction after Foreclosure (2010 Mass. Acts 258 enacted Aug. 7, 2010)
Foreclosing owners may not evict tenants after foreclosure except for just cause.
Protection for Subsidized Tenants (Mass. Gen. Laws ch. 186, § 13A)
In Massachusetts, foreclosure does not terminate tenancies subsidized under state or federal law.
Minnesota (primarily non-judicial foreclosure through power of sale)
Eviction protections (Minn. Stat. § 504B.151, as amended by 2010 Minn. Laws 315)
Minnesota has revised its post-foreclosure notice requirements to substantially parallel the tenant protections in the PTFA.
Pre-Foreclosure Notice to Tenants (Minn. Stat. § 580.042)
For foreclosures on properties with one to four dwelling units, Minnesota law requires the foreclosing party to give notice to tenants indicating that the lease is still valid during the foreclosure process. The notice must also state that during the six-month redemption period following the foreclosure sale, the tenant cannot be asked to move. Also, the new owner must give written notice following the redemption period to evict the tenant. A violator of this statute is liable to the tenant for $500.
Disclosure of Foreclosure to Prospective Tenants (Minn. Stat. § 504B.151)
Once a landlord has received a contract for deed of cancellation or notice of a mortgage foreclosure sale, the landlord may not enter into a periodic lease of more than two months or for a term that extends beyond the redemption period. If the landlord enters into a periodic or short-term lease, then the landlord is required to provide written notice to the prospective tenant of when the mortgagor’s redemption period ends.
Utility Shutoff Protections (Minn. Stat. § 504B.215)
For master-metered buildings in Minnesota, utility companies must post notice before shutting off utilities for nonpayment. Tenants are allowed to continue service by paying current charges, but they are not required to pay for any arrearages incurred by the landlord. In buildings with fewer than five units, tenants have the right to put the utility accounts in their own names.
Security Deposit (Minn. Stat. § 504B.178)
Minnesota law allows tenants to apply their security deposit to rent during the redemption period following a foreclosure sale. The tenant’s withholding of any rent for the last payment period of the residential rental agreement creates a rebuttable presumption that the tenant intended the deposit to serve as payment for the rent. When the landlord’s interest in the property ends (for example, because of death, foreclosure or contract for deed cancellation), the security deposit must be transferred to either the new owner or the tenant. This transfer must take place within 60 days after the current landlord’s interest in the property ends or when the new landlord is required to return the security deposit.
Record Sealing of Post-foreclosure Evictions (Minn. Stat. § 484.014)
In Minnesota, eviction records shall be expunged if a tenant in a foreclosed property did not receive a proper eviction notice.
Utility Shutoff Protections (Minneapolis Code of Ordinances § 244.590)
In Minneapolis, a local ordinance provides that tenants in a building may pay any rents owing to the owner or operator of the building directly to the utility company. The utility company must make available to any requesting tenant or tenant’s representative the utility account of the multiple dwelling or duplex housing facing a shutoff. Any such payment shall be considered a reduction of rent owed by the tenant and a reduction of the utility bill owed by the owner or operator of the building.
Foreclosure Notice to Tenants (Minneapolis Code of Ordinances § 244.265)
In Minneapolis, a landlord must notify tenants of a foreclosure within seven days of the receipt of a foreclosure notice.
Montana (primarily non-judicial foreclosure through power of sale)
Pre-Foreclosure Sale Notice to Tenants (Mont. Code Ann. 71-1-224)
Notice of sale must be served personally at least 30 days before the sale date “upon the occupant of the property so advertised for sale.”
Nevada (primarily non-judicial foreclosure through power of sale in deed of trust)
Pre-Foreclosure Sale Notice to Tenants (AB 140, 2009 Nev. Stat. 2781-82, 2788)
Nevada requires that a pre-foreclosure notice be “served upon any tenant or subtenant, other than the judgment debtor” who occupies the property. The statutory scheme requires notice to be posted in three separate public places and published for three successive weeks. Willfully removing or defacing a posted notice of sale is unlawful.
Disclosure of Foreclosure to Prospective Tenants (AB 140, 2009 Nev. Stat. 2791)
Nevada requires a landlord to provide written disclosure to a prospective tenant if the property to be leased or rented is the subject of any foreclosure proceedings. A willful violation constitutes a deceptive trade practice under Nevada law.
New Hampshire (non-judicial foreclosure through power of sale)
Good Cause Eviction Protection (N.H. Rev. Stat. Ann. § 540:2)
In New Hampshire, good cause is required to evict tenants from restricted properties. Single-family houses acquired by banks or other mortgagees through foreclosure are defined to be nonrestricted properties. N.H. Rev. Stat. Ann. § 540:1-a.
New Jersey (judicial foreclosure by suit in equity)
Pre-Foreclosure Notice to Tenants (N.J. Ct. R. 4:65-1-4:65-2, as amended by NJ Orders 2009-37)
New Jersey requires foreclosing parties to serve, by personal service or by regular and certified mail, a “Notice to Residential Tenants of Rights During Foreclosure” to all residential tenants in the property being foreclosed. Notice of sale posted on the premises must also contain the Notice to Tenants. Notice informs tenants that foreclosure is not a valid ground to remove a bona fide tenant.
Good Cause Eviction Protection (N.J. Rev. Stat. § 2A:18-61.1 et seq)
New Jersey’s Anti-Eviction Act prohibits evictions that are based on foreclosure. Chase Manhattan Bank v. Josephson, 638 A.2d 1301 (N.J. 1994).
Post-foreclosure Notice (N.J. Rev. Stat. § 2A:50-70)
In New Jersey, a new owner after foreclosure must make a good faith effort to identify tenants living on the property. Within 10 business days of obtaining title, the new owner must post a written notice prominently on the door of each unit and send the notice to each tenant by regular and certified mail. The notice must be in English and Spanish and must inform the tenant that he has a right to remain after foreclosure, even if the tenant does not have a written lease. In a property with more than 10 residential units, the notice must also be conspicuously displayed in a common area in each building of the property. A person who violates the statute is liable to the tenant for $2,000 per violation, plus attorney’s fees and costs.
Habitability (N.J. Rev. Stat. § 2A:50-71)
In New Jersey, a lender is responsible for maintaining a property between the time a foreclosure filing is made and the sale.
New York (judicial foreclosure)
Foreclosure Notice to Tenants (N.Y. Real. Prop. Acts. Law § 1303)
New York requires the foreclosing party to notify tenants of an impending foreclosure through a notice delivered by both certified and first-class mail.
Eviction protections (N.Y. Real. Prop. Acts. Law § 1305)
New York has enacted many provisions of the Protecting Tenants at Foreclosure Act into state law. Like the PTFA, New York law gives tenants the right to remain in their homes after a foreclosure sale for 90 days or the remainder of their lease, whichever is longer. Also similar to the PTFA, New York law allows a purchaser who intends to reside in the property as his or her primary residence to evict the tenant with a 90-day notice, even if the tenant has more than 90 days remaining on the lease.
New York law also grants tenants new protections in addition to those in the PTFA. Specifically, New York law covers tenants in properties that were disposed through other means, such as a short sale or deed in lieu of foreclosure, if the property is transferred during the pendency of a foreclosure proceeding. Finally, unlike the PTFA, which expires at the end of 2012, the New York law does not contain a sunset provision.
Habitability (N.Y. Real. Prop. Acts. Law § 1307)
In New York, there is a statutory duty on lenders to maintain foreclosed properties during the time period between the entry of judgment of foreclosure and sale and the transfer of title at a foreclosure sale.
Good Cause Eviction Protection in Rent-Controlled or Rent-Stabilized Properties
In Nassau County, good cause is required to evict tenants from rent stabilized units.
Good Cause Eviction Protection in Rent-Controlled or Rent-Stabilized Properties (9 N.Y.C.R.R. § 2204.1)
In New York City, purchaser of a rent-controlled or rent-stabilized property at foreclosure sale must have good cause to evict, and foreclosure is not a good cause. United Institutional Servicing Corp. v. Santiago, 310 N.Y.S.2d 733 (Civ. Ct. 1970).
Good Cause Eviction Protection in Rent Stabilized Properties
In Rockland County, good cause is required to evict tenants from rent stabilized units.
Good Cause Eviction Protection in Rent Stabilized Properties
In Westchester County, good cause is required to evict tenants from rent stabilized units.
North Carolina (primarily non-judicial foreclosure through power of sale with limited hearing before court clerk)
Pre-Foreclosure Sale Notice to Tenants (N.C. Gen. Stat. Ann. § 45-21.17)
North Carolina requires the posting of a notice 20 days in advance of a foreclosure sale. The notice must also be mailed first class to interested parties at least 20 days before sale, and if the property has fewer than 15 rental units, notices must be mailed to tenants occupying the property.
Oregon (primarily non-judicial foreclosure through power of sale in deed of trust)
Notices to Tenants (Or. Rev. Stat. § 86.745, amended by SB 1013 effective 3/4/10)
Notice is addressed to occupant or tenant and informs tenants that tenants must receive at least 30-days notice to vacate. This notice can be given on or after the sale date. The notice states that federal law may grant additional rights. Notice informs tenants that they may apply security deposit and prepaid rent toward current rent obligations and that that they must notify landlord in writing if they elect to do so.
Security Deposit (Or. Rev. Stat. § 90.367)
Oregon law now allows tenants in properties undergoing foreclosure to apply their security deposit and any prepaid rent toward their rental obligation. To take advantage of this law, the tenant must provide written notice to the landlord of the tenant’s intent to do so.
Disclosure of Foreclosure to Prospective Tenants (Or. Rev. Stat. § 90.310)
Oregon requires a landlord of a one-to-four unit property to notify prospective tenants if, at the time of execution of the rental agreement, the property is being foreclosed upon. If the owner fails to comply, the tenant may recover twice the actual damages or monthly rent, whichever is greater, and any prepaid rent.
Pre-Foreclosure Sale Notice to Tenants (Providence Code of Ordinances § 13-219)
At the same time a notice of sale is provided to the mortgagor, lenders/mortgagees are required to serve, by mail and posting, a notice to all bona fide tenants in the property being foreclosed upon. The notice, "(i) stating that the real estate is to be sold in foreclosure, which may affect the tenant's right to continue to live in the property; (ii) stating the date, time and place of sale; (iii) providing the address and telephone number of Rhode Island Legal Services; and (iv) providing the name, address and telephone number of HUD-approved counseling agencies in Rhode Island," must be in both English and Spanish. A successor in interest may not evict bona fide tenants until such notice is given.
Eviction Protections (Providence Code of Ordinances § 13-219)
In Providence, bona fide tenants, meaning tenants who entered into a rental agreement with the former landlord or mortgagor at least 30 days before the foreclosure sale, may remain in their homes until the end of the lease term. For bona fide tenants without leases, the tenancy is converted into a month-to-month tenancy.
Post-foreclosure Notice Requirement (Providence Code of Ordinances § 13-219)
A successor in interest after foreclosure must post and mail each bona fide tenant a notice, in English and Spanish, informing the tenant that the the property was sold at a foreclosure sale. The notice must also state "the name and address of the successor in interest, and/or managing agent so that the tenant may know to whom the ongoing rental payments should be made." A successor in interest may not evict bona fide tenants until such notice is given.
Utility Services (Providence Code of Ordinances § 13-219)
If essential utility services, including heat, running water, hot water, electric, sewer or gas, were provided by the foreclosed mortgagor, the successor in interest after foreclosure is required to continue providing these utility services to bona fide tenants.
Utah (primarily non-judicial foreclosure through power of sale)
Pre-Foreclosure Sale Notice to Tenants (H.B. 243 enacted Mar. 22, 2010)
Foreclosure Processes on Residential Rental Properties, House Bill 243, goes into effect on May 11, 2010. The bill requires a notice of tenants’ rights be posed on each door or mailed to tenants in foreclosed properties. The notice references the Protecting Tenants at Foreclosure Act in that renters may be allowed to occupy the rental unit until the rental agreement expires or a minimum of 90 days. The notice alerts renters that they must continue to pay their rent. The bill sunsets with PTFA on December 31, 2012.
Vermont (judicial or strict foreclosure)
Foreclosure Notice to Tenants (Vt. Stat. Ann. tit. 12 § 4523)
The plaintiff in a judicial foreclosure must join tenants in the action. The complaint is mailed to the tenant, and it must be addressed to “occupant” if the rental agreement is not recorded. The notice informs tenants that the property they live in is in foreclosure and that their right to remain on the property may end when the foreclosure is completed. The notice also tells tenants that they must tell the court their names and addresses to be kept informed of the status of the foreclosure action.
Disclosure of Foreclosure to Prospective Tenants (Vt. Stat. Ann. tit. 12 § 4523))
Upon receipt of a foreclosure complaint, the mortgagor must disclose to “each tenant who enters into a residential rental agreement” that the property is in foreclosure and that, in the event the mortgagor is unable to redeem the property, the tenant may be required to vacate the premises on 30-days notice.
Virginia (primarily non-judicial foreclosure through power of sale)
Foreclosure Notice Tenants ((Va. Rev. Stat. § 55-225.10)
Virginia law requires a landlord to give written notice to the tenant of a mortgage default, notice of mortgage acceleration, or notice of foreclosure sale relative to the loan on the dwelling unit within five business days after written notice from the lender is received by the landlord.
Security Deposit (HB 231 enacted Mar. 29, 2010)
The holder of the landlord's interest in the dwelling unit at the time of termination of tenancy must return any security deposit and any accrued interest that is owed to the tenant, whether or not such security deposit is transferred with the landlord's interest by law or equity, and regardless of any contractual agreements between the original landlord and his successors in interest.
Washington (primarily non-judicial foreclosure through power of sale in deed of trust)
Pre-Foreclosure Sale Notice to Tenants (Wash. Rev. Code § 61.24.143)
Washington requires pre-foreclosure notices to be “posted in a conspicuous place on the property” or “served upon any occupant of the property.” Additionally, Washington requires that an additional pre-foreclosure notice be mailed to the resident of property subject to foreclosure sale. The additional notice must contain the following text: “The foreclosure process has begun on this property, which may affect your right to continue to live in this property. Ninety days or more after the date of this notice, this property may be sold at foreclosure. If you are renting this property, the new property owner may either give you a new rental agreement or provide you with a sixty-day notice to vacate the property. You may wish to contact a lawyer or your local legal aid or housing counseling agency to discuss any rights that you may have.”
Good Cause Eviction Protection (Seattle Code § 22.206.160(c))
Good cause is required to evict from many buildings in Seattle, but the sale of a single family home is a good cause to evict.
Wisconsin (primarily judicial foreclosure)
Foreclosure Notice to Tenants (Wis. Stat. § 846.35)
Wisconsin requires a foreclosure plaintiff to provide notice to tenants at the start of the foreclosure proceeding. Notice must also be provided to tenants no later than five days after judgment of foreclosure is entered and of the date and time of the confirmation of sale hearing once the hearing has been scheduled. Notice is to be served either by personal service or certified mail. The foreclosure plaintiff is also prohibited from naming a tenant in the foreclosure action. A tenant may recover $250 in statutory damages and reasonable attorney fees from a plaintiff who violates the above provisions.
Disclosure of Foreclosure to Prospective Tenants (Wis. Stat. § 704.35)
In Wisconsin, a landlord must disclose to prospective tenants if a foreclosure action has been commenced on the property. Any rental agreement entered into during the pendency of the foreclosure action and before the expiration of the redemption period must include a separate written acknowledgement by the tenant that the disclosure was provided.
Security Deposit (Wis. Stat. § 846.35)
In Wisconsin, a tenant can choose to apply the security deposit to his or her last month’s rent, even if the tenant retains possession after the sale of the property is confirmed.
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