SANTA ROSA (Sonoma County), CA -- The big news in landlord-tenant law is that President Obama has extended the Protecting Tenants at Foreclosure Act through 2014, This law gives tenants renting from landlords who are later foreclosed on 90 days (if they have a month to month lease) or the remainder of the lease (if there's a current written lease.)
The problem with the law has been that it talks about leases entered into before "foreclosure.' Well, in California (and probably many other states) there is no specific event called foreclosure. There are two events: there's the notice of default and the actual sale. Banks have argued that "foreclosure" begins at the notice of default, which I personally think is ridiculous, since, although it's required for foreclosure, it's a totally curable notice of a problem.
The new law now makes clear that "foreclosure" means foreclosure (sale), not notice.
For instance, I was hired by a Santa Rosa tenant who was renting from a landlord who was later foreclosed on. Despite the fact that the tenant had a lease, the bank's lawfirm was intent on evicting the tenant immediately. I informed the firm of the Protecting Tenants At Foreclosure Act, which says that a foreclosing party has to respect the tenant's preexisting lease.
The lawyers wrote back that the PTAF law only applies to leases entered before "foreclosure," and that since the lease was entered into after the notice of default (thus after foreclosure) he was not a bona fide tenant.
The case settled before we could get to court, but now we know that we were right and the banks are wrong.
