Yes, I agree AB2586 is a start. The only problem with the notification process is that the tenant will be notified when the Notice of Trustee Sale is recorded. That gives the tenant at best 20 days notice. That certainly doesn't help much.

Steve Gold

www.tenantforeclosure.com (Giving tenants the notice they need)

Very timely topic. Here is what I have been advising tenants -- 

Actually, there are no 'fool-proof' or 'absolute' ways to protect yourself from fraud by any Landlord/Lessor/property owner or anyone, for that matter. Just look at the Bernie Madoffs of the world, and he duped some significant players out there. However, there are many different and absolutely helpful steps you can take to keep yourself informed and lessen the likelihood you'll fall prey to an unscrupulous landlord/lessor. There are essentially several things you can do to arm yourself in this environment; I articulate three (3) below.

First, I would definitely pay for some service to check to see if a landlord/lessor is in the foreclosure process; that process in many jurisdictions can take up to 6 mos. Although, I believe there a limit to which you should pay, and not all services are accurate or even promising, nevertheless you should consider some type of notification service. One service I know of that is accurate and relatively inexpensive is Tenant Protection Services (www.TenantProtectionServices.com) ***. Landlords/Lessors typically will pay (or sometimes charge their tenant/lessee) for a credit report fee of $25-$35 in some areas. It is proactive and a small fee for a tenant to pay $15 for a one-time report or $25 for a year (of monthly reports) to find out if a potential landlord is in foreclosure or once in the property to be notified if it falls into foreclosure at some point after signing a lease.

Second, I would negotiate with the lessor at the outset and put some terms into any lease or month-to-month rental. Now, be aware that there is no guarantee that a lessor will agree, and if you are bidding on a rental that has multiple offers to rent, you could be out of luck inserting your favorable terms. Although, as tough as it may be, it is worth a try. I would suggest that you make it a covenant of the lease contract that the lessor makes all mortgage, property tax, HOA dues (if applicable), and insurance payments; if you are going to covenant paying rent, keeping the place up, adhering to other obligations in the lease, etc. So, if your landlord/lessor doesn’t comply with those covenants or obligations, you may be able to forego your obligation to pay rent if you made the lessor’s obligation to pay the mortgage (or taxes) an affirmative covenant of the lease, the breach of which could then relieve you of the obligation to pay rent until the lessor’s default is cured.

Third, you can record your lease with the county recorder’s office for the county in which your potential property exists. This will put on notice any lienholder that is going to file a “notice of default” or “notice of Trustee sale” that you have a possessory interest in the property and should send you a copy of whatever they would record in the county with respect to that property. Although, you will have to pay for every page of your lease that gets recorded and every county charges differently; costs could amount to $10 per page, plus a recording fee. However, this is not a bad idea if notice is important.

If you follow all this and complete your due diligence, you will greatly reduce the chances you’ll have to sue your lessor for your deposit or rents or be surprised one day when the sheriff or the bank rep comes knocking your door, because they won’t; you’ll have already been noticed weeks or months beforehand. All the best.

<!--[if supportFields]><span style='font-size:14.0pt'><span style='mso-element:field-begin'></span><span style="mso-spacerun: yes"> </span>CONTACT _Con-3A65D3211 \c \s \l <span style='mso-element: field-separator'></span></span><![endif]-->Todd Rubinstein<!--[if supportFields]><span style='font-size:14.0pt'><span style='mso-element:field-end'></span></span><![endif]--> is a licensed California Real Estate Broker affiliated with Coldwell Banker Residential and Commercial Brokerage specializing in Single Family, Multi-Family, Probate, Trust Sales, Conservatorship, Trustee Sale Investor and REO (Bank and Lender Owned) transactions. Also, a licensed California Attorney he once prosecuted some of LA County’s finest, and currently provides advice on a myriad of legal issues, including but not limited to Real Estate issues, Criminal Defense matters, Family law and Landlord/Tenant rights and obligations as well as Condo and HOA law.

*** disclosure – I know of the accuracy, because I have an affiliation to the service.

Sorry for the weird posting font. Don't know how that happened. Can the comment be removed or readjusted?