Condo I'm renting is getting foreclosed against

[OCNewbie]

Just looking for legal advice, or general advice on what I should do.

Got a letter in the mail explaining to me that the owner of the condo I rent (I rent through a leasing agency) is in a "Chapter Seven Bankruptcy." And also states that "the mortgage company has obtained relief or soon will obtain relief from the automatic stay protection of Bankruptcy Act." It then says "You should be making plans to relocate from the above residence."

My lease doesn't end until October. I have a $650 refundable deposit on the condo.

I'm wondering what my rights/options are at this point. What can they do to make me leave under the circumstances? I have paid my rent on time every month up to this point. Can they evict me? How long is that process? Might I be entitled to my deposit sooner than October? Would I be able to somehow get any free rent or compensation out of this for having to move out prior to my signed lease agreement?

Hoping this will catch the eye of someone with more experience in this situation than I have. Any other suggestions on what action I should take would be appreciated.

Thanks

 

[AgaBoogaBoo]

Can you buy it?

 

[Injury]

Originally posted by: AgaBoogaBoo
Can you buy it?

I'd check in to this option.


Alternatively, you could try just not paying rent at all in a sort of "I'm gonna get screwed so I might as well" deal. (kidding... sort of.)

 

[alphatarget1]

Unless the mortgage company found a buyer already... which I highly doubt, wouldn't it be pretty stupid to kick you out? If you stay there at least you can pay them rent.

I'd try to "negotiate" with them.

 

[silverpig]

Interesting situation. I'd be interested to see how it pans out.

My guess is your deposit is toast. If the company you gave it to has no money, then I believe their assets get sold off and the creditors stand in line for their share. My guess is the bank is going to be the first one into the pot and they'll take the building and whatever assets the company had. Depending on how much the company had paid off, there might not be any assets left to refund your deposit. However, perhaps your deposit is higher on the list than everything else...

You could look into buying... especially if the bank can sell it to you with a mortgage that is cheaper than your current rent.

Of course I have NO idea about these kinds of things, so this may all be completely wrong.

 

[JasonCoder]

I have a friend who was in a similar situation once. The guy who collected the rent didn't come around because they foreclosed on him. My friend ended up not paying rent the last few months he was there.

I bet you get a few months free out of it. Just try not paying your rent on time the next time it's due. Seriously. If they're dicks about it just say whoa, chill, forgot about the date. I don't think it's a shitty thing to do either because it might be the only way you can get back your deposit.

 

[ProfJohn]

You're screwed.

Clark Howard did a bit on this and you pretty much have no rights.

Like some have said stop paying rent and use the money to find and pay for a new place.

Have you talked to the rental agency at all? I am sure they won't like the no rent option, but what are they going to do? Kick you out sooner?

BTW I am guessing that one months rent is more than your deposit so don't pay rent for your last month and call it even.

 

[bctbct]

cash for keys is in your future.

 

[OCNewbie]

ttt b4 bed

 

[Scarpozzi]

I think you're going to have few rights as far as your contract goes. You should be able to get your deposit back because it's not technically THEIR money. It's YOUR security deposit and not theirs, so it shouldn't be up for grabs from the backrupcy folks....

The only rub is that most places don't keep that money on hand and you'll likely have to fight to get it or go to small claims court to get it back.

Consider talking with the company and opening communication up to find out where things stand. If you're going to be forced to move earlier than October, they are the ones that will likely have an idea of how things will go. If they can't tell you, write them a letter and formally ask them for a reply. That way you'll have a written contract in addition to your current lease that explains the situation. Most lease contracts have a clause in them that states they only have to give you 30 days notice to evict you in this kind of event. (My rentals do) If you try talking with them and try to be understanding, you might end up getting 45-60 days notice...or more.

 

[HannibalX]

Originally posted by: silverpig
Interesting situation. I'd be interested to see how it pans out.

My guess is your deposit is toast. If the company you gave it to has no money, then I believe their assets get sold off and the creditors stand in line for their share. My guess is the bank is going to be the first one into the pot and they'll take the building and whatever assets the company had. Depending on how much the company had paid off, there might not be any assets left to refund your deposit. However, perhaps your deposit is higher on the list than everything else...

You could look into buying... especially if the bank can sell it to you with a mortgage that is cheaper than your current rent.

Of course I have NO idea about these kinds of things, so this may all be completely wrong.

Leasing companies just represent private owners (at least in FL). I rented a condo in Orlando for years and the leasing company is just a proxy between you and the real owner.

OP that sucks man. So basically the owner has been taking your check every month and pocketing it without paying the bank note. What part of Orlando (if you don't want to say no biggie). Lots of old apartment complexes in Orlando went condo so be careful if you buy that the place doesn't have "problems".

 

[cortdizzle]

just to get it out of the way, the OP doesnt want to purchase the condo.

a main concern is the timeframe in which these things will take place... the letter doesnt state any timeframe that is suggested to move out. and its uncertain as to when the actual process of foreclosure will take place or when/if the OP will in fact be evicted. also, evictions go against you on your credit report... does it matter WHY youre being evicted? can an eviction in a case of foreclosure be removed from your credit?

i looked up how long the landlord has to pay up the security deposit and its supposed to be in about 15-30 days after the tenant moves out.

i feel like the best idea is to talk to the property manager (the real estate agency handling the lease) in regards to what the best step would be in regards to moving out. frankly, if the mortgage isnt being paid, the property manager cant possibly be getting their cut of the rent for handling the property.... i would assume things would run much more smoothly for everyone involved that there not be a tenant in place. especially if the OP has a place to stay, he could get his deposit back and out of a very stressful situation before it gets any more confusing or frustrating.

lastly, its doubtful that any free rent or compensation for breaking a lease will be owed. if you read your leasing agreement, theres bound to be something in there stating something about a situation such as this.

pack your shit OP and go live with your girlfriend.....

 

[cortdizzle]

bump

 

[Capt Caveman]

Originally posted by: cortdizzle
bump

Why would you bump this, 15 minutes after your last post?

 

[cortdizzle]

Originally posted by: Capt Caveman

Originally posted by: cortdizzle
bump

Why would you bump this, 15 minutes after your last post?

because, i was bored
and because i wanted to give it maximum exposure.
i know the OP and was just trying to get more people to view it in hopes someone with any inherent knowledge would give useful input.

besides, who cares if i bumped it or not

 

[KK]

bump

 

[cortdizzle]

Originally posted by: KK
bump

hahaha

youre my new best friend

 

[amdforever2]

You can't sue them in small claims court because of the automatic stay. You can't sue the bankrupt company that has your deposit.

That deposit is part of the bankrupt companies assets and what you get if anything will be distributed by the court.

Stop paying rent. No reason not to. The owner of the property will become the bank and they will either evict you or you'll have to buy the property.

 

[cortdizzle]

Originally posted by: amdforever2
You can't sue them in small claims court because of the automatic stay. You can't sue the bankrupt company that has your deposit.

That deposit is part of the bankrupt companies assets and what you get if anything will be distributed by the court.

Stop paying rent. No reason not to. The owner of the property will become the bank and they will either evict you or you'll have to buy the property.

ummmmm...... you wont HAVE to buy the property... whos going to force you? thats nonsense... bottom line is once the foreclosure is complete, the OP will pretty much have to move out. i read somewhere that banks dont want to be landlords, which is definitely true, they arent going to want to deal with having a tenant. its more than likely, the landlord will try to get you out of the apartment before shit really hits the fan. -- oh and i think you misunderstood... its an actual person who owns the property who is bankrupt... not a company. and for the most part, many states require deposits to be put in an escrow account for cases like this or to be used for rental repairs....

youre best bet is to just be prepared for that to happen. and yea, you can sue for your deposit, because leasing contracts clearly state what the money is for and that deposits are returned for two reasons, the end of a met leasing term, or the end of a lease on the landlords accord....

has no one ever rented property before???

oh and if you just stop paying your rent, theres a real risk of that going on a credit report if the owner decides to take you for unpaid rent since the lease is still technically in action.

 

[amdforever2]

I said get evicted or buy it

so?

 

[cortdizzle]

lol it just doesnt seem like a logical sentence.... the idea of "having" to buy something that isnt your responsibility. i wasnt being rude btw, i was just saying...

 

[amdforever2]

The landlord owes him the deposit.

The landlord has filed for bankruptcy.

OP is now a creditor of the bankrupt landlord.

Filing suit against the landlord in state court is pointless.

The automatic stay of the bankruptcy will halt any state case and the discharge if granted could wipe out a judgement.


If OP is aware of a bankruptcy and tries to collect the money without going through the proper bankruptcy court processes, that might be contempt, I think.

 

[cortdizzle]

well it might help if i or anyone else for that matter knew what an "automatic stay" was.....
all i know is that in all the research i did, OP is entitled his deposit. and he can take legal actions to get it.
not paying rent is too risky... especially since everything is in the beginning stages and nothing has really happened YET. why screw up pristine credit for uncertainty? the bankruptcy has nothing to do with the OP other than the fact he resides in the soon to be foreclosed property.... he wouldnt be in contempt of anything.... just a guy trying to make true a contract signed by the owner of the condo

 

[theeedude]

Stop paying rent. I read that it takes banks forever to actually kick someone out, and a lot of people just stopped paying mortgages and are living in their houses rent free

 

[OCNewbie]

ttt