Tenants beware. Your cash may be nothing but trash!!!

Hi Bryant, this is great information, most do not know the first thing about the process.  They are renting and have no clue anything is about to happen o change their life.  Nice post Bryant.

BB,

I think this is someting happening all over, we have it here too in SoCal. It happened to one of my clients, they came home and found a notice on the door.

Then another office client has been paying her rent to one of these third-party stop-foreclosure scams, $2,300 a month. So far the trustee's sale keeps getting postponed and they keep paying the rent.

I'll bet a lot of the tenants take their frustration out on the property. It doesn't help them financially though.

This, to me, is one of the problems of this whole mess not many folks are talking about.  Tenants are being taken on a ride they didn't buy a ticket for.  It's a shame that so many are locked out of the housing market but to compound that with having their rent and deposit money go up in smoke is to add insult to injury.  Due diligence on the part of agents helping tenants is a must... as with any client.  Good stuff BB.

This makes the lot of tenants so much harder. We don't see much of this around here - at least not now, except perhaps in Yonkers and parts of Peekskill.

BB, tenants are part of our liquidity crisis.  They need some protection too.  I thought lenn's and your comments were spot on.  And also the comment about TLW.  AJ

BB,

Typical of what`s happening throughout the state.

Too bad the landlord/tenant act refuses to address these new issues.

Broker Bryant, Let me tell you I think that woman should get hazard pay. I would never want that job. 

BB - Interesting topic that had never given much thought too. It seems there is no one who escapes the present Real Estate conditions throughout the country. I think Lenn makes a good point in asking the owner to verify they are current on their mortgage.

Unfortunately it is the one's who can least afford to be booted that suffer in these situations. Good head's up for all of us.

Good idea to pay the rent to an escrow that will pay the mortgage, but if I waited on the tenant before paying the mortgage I would have most of my properties in default.

The response was that they have so many vacant properties it's really not a problem relocating tenants AND they make another upfront commission as they usually keep 50% 65% of the 1st months rent in my area!!! This attitude left me dumbfounded.

I too am dumbfounded!!!  They apparently believe that the inconvenience, angst and confusion of relocating tenants is insignificant.  Tell that to a child who has to change schools. 

BB - great post and very enlightening for prospective tenants looking for homes to rent - cavaet emptor or let the tenant beware. You pointed it out that we as Realtors must do dilligence when helping tenants looking for a home to rent. I just hope that a prospective tenant would seek the help of a Realtor in their rental search.

What a sad state of affairs that scenario is.  There are a portion of renters of course who cannot buy a house and to have their deposit tied up (GONE) and try to scrape together the money to rent another house puts such a financial burden on them, for some, a burden that they would have a hard time getting out from under.

I like Thesa's suggestion about offering a short sale to the Tenant.

Before taking on any property management contract, you need to do an online search to make sure there is no lis pendens recorded.  Then in the property management contract and any lease document, there should be something addressing what happens if the property goes into foreclosure.

Because I am in your back yard, I've experienced the same problems, but found a great solution.  This may not work for everyone, but if the rental has been for sale, you can look up in our mls where the house expired.  Click on the imapp button to the left and

It will tell you if there is a lis pendens on the property, give you the atty's name and contact info. 

For those with MLS's without this capability, have your title company do a search,

They can find out what the situation is.  This way you can talk to the lender, see if

The buyer can purchase if they want, or at least stay away from renting that property.

For those of you who do not use title companies to close, the attorney can do the same thing.  You give them business, so ask them to help you out when you need it.

Hope this helps!  Btw, for any of you who are doing short sales, I have a company that will do all the nasty work; Calling lender, staying on hold 45 min, get cut off, then finally

Get someone who has no clue. For those of you who want to do this, my company can handle deals all over the US, so if you want more info on how this works, give me an

Email or phone call and I will explain.

 In defense of the lenders, they are just OVERWHELMED and can't handle the case load. 

I'm working with a short sale right now, and after MONTHS of going thru this, they told me they hired more people, trained them, and ready to get rid of all these non performing assets.... So they are ‘getting it'.  I think we'll have this issue for at least another 2 years. 

Speaking of attys, find one and tell them you'd like to help out with his short sales, etc.

The lenders goal is to SELL the house, so you could get the listing. 

Hope this helps!

That would be a bummer!  Another reason to own vs. renting, huh? ;-)  I know that in Missouri a tenant does have some tenant's rights and that there are some others being considered as part of some federal leglislation, but it would still suck to be in this position.

As far as what you could do to protect yourself if you were considering renting, I like the escrow idea that you proposed.  If the land lord wasn't willing to do that, maybe you could negotiate it into the lease that the landlord provide proof that each monthly payment has been made?

Bob Mitchell

ValueList Real Estate Services, Inc.

These days, I believe that a prospective needs to be proactive and inquire into the status of the ownership of the house and the mortgage before signing a lease.

Regards,

I agree

Once it forecloses, it is a bit late to ask the Sheriff what happened and why.  This is a very good point for renters.  Proactive- get information-try to weigh out the risk of renting.  Times and people are not what they used to be.

This is such a huge problem here too.  We ask that rents and mortgage payments are all paid through escrow.  I also encourage clients to check for any outstandling liens against the property at the clark county website.  Even a trash or HOA lien can signify that the property owner is in trouble.