http://www.cnn.com/2007/US/11/30/willis.rentervictims/index.html?iref=mpstoryview
If a tenant that had signed a lease before a property became foreclosed is paying his/her rent on time and the lender knows he will have a difficult time selling the foreclosed property why would it not be in the lenders interest to allow the tenant's lease to continue?
2007-11-30 08:49:14 · 12 answers · asked by David K 4 in Business & Finance ➔ Renting & Real Estate
1. I am referring to a renter that has taken care of the property.
2. If thats the case why not take the money from 6 months of rent(for example $1800 times 6 =$10800.) and allow a renter to finish out there lease instead of letting it sit with little possibility of selling it .
2007-11-30 11:09:04 · update #1
This is ridiculous these comments
You have thousands upon thousands of homes where renters who ahev been paying there renter on time being thrown out. These homes are going to sit with property tax due and the lender has to pay it yet he would reject the rent of 10,800 in 6 months just TO LET SOMEONE RUN OUT HIS LEASE.
YOU CANT BE THAT STUPID.
Thats alot of dough yet you really think property management is a huge expense againt that much money coming in?
What if you had 10 homes at 10.800 every 6 months just finshing a lease.?
Thats 64,800 dollars.
The lender would rather sit and pay the 20,000 in property tax out of his own pocket???
The leasee is paying the electricity, trash, water and other utilities???
2007-11-30 11:51:22 · update #2
Lenders want the house vacant for immediate occupancy at the time of the sale. They have no interest in dealing with tenants. They just got done dealing with an owner who cost them a lot of money.
Pay no attention to the first response. Leases do NOT transfer to the lender/owner in the event of a foreclosure.
There ARE situations in which a lender will continue a lease, but those are limited to properties which are specific rental properties, such as a four or six unit apartment building. In that case a lender understands that he has a better chance of selling for market value if the units are well leased and occupied.
2007-11-30 08:52:02 · answer #1 · answered by acermill 7 · 4⤊ 0⤋
Lenders are not in the property business, they are in the money lending business. Renting property is a very different business than lending money and lenders would have to take on a great deal of additional overheard expense to staff up for property management and servicing rental contracts. It's not reasonable to ask a lender to incur that expense just because a renter--with whom the lender never had any sort of relationship--is in the house.
2007-11-30 11:26:26 · answer #2 · answered by Anonymous · 1⤊ 0⤋
They don't want the responsibility of dealing with repairs on the house if something happens while it is rented. Also, if the renter is injured on the property they can sue the loan holder (bank). If the renter doesn't pay their rent then they have to evict them anyway. Plus, what if renter is mad at landlord and trashes the place? More money out of bank's pocket. By and large it is much cheaper and easier to let it sit empty
2007-11-30 08:54:46 · answer #3 · answered by busymomkaren 5 · 3⤊ 0⤋
I didn't bother reading the article, but if I'm understanding you correctly, here's why.
Foreclosures and evictions are time and cost consuming. If the foreclosure were stopped and the tenant allowed to continue on as usual, the process would have to start all over again in the very likely event the tenant defaults again. Of course, this means that some well-meaning individuals who just hit some bumps will be evicted, but most of the time you're dealing with someone who is in over their head and will just repeat the behavior given a 2nd chance.
2007-11-30 08:56:00 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Speaking as a landlord, if the tenant is no longer permitted to live at the rented address, for whatever reasons then, the contract is null in void. Contracts can be broken by a third party.
But if the residence is still habitable then the renter can only get out of the contract via arbitration.
2007-11-30 08:53:59 · answer #5 · answered by cashflow_2000 5 · 1⤊ 0⤋
REO stands for Real Estate Owned. These are properties that have gone through foreclosure and are now owned by the bank or mortgage company. This is not the same as a property up for foreclosure auction. When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accumulated during the foreclosure process. You must also be prepared to pay with cash in hand.
2007-11-30 08:53:58 · answer #6 · answered by John 2 · 0⤊ 1⤋
The lender may want the property available to show at all times and doesn't want to scare a potential buyer into thinking they'll have to struggle to remove a renter in order to take possession.
2007-11-30 09:23:54 · answer #7 · answered by Anonymous · 0⤊ 0⤋
Harder to manage a property with a tenant, than an empty house. Tenants can cause a lot of damage and liability issues that big banks are unlikely to want to deal with. On the upside, perhaps the tenant can make an offer on the property.
2007-11-30 08:53:46 · answer #8 · answered by Lola 4 · 3⤊ 0⤋
Who are you paying your rent to? The person who lost the property? The bank is the Owner, your landlord defaulted on the mortgage payment.
You need to negotiate with the new owner, the Bank.
Good luck!
2007-11-30 08:54:16 · answer #9 · answered by Maggie 3 · 2⤊ 0⤋
your lease isn't with the bank, it's with the foreclosee, so he must have been keeping your rent payments instead of using them to pay the mortgage on the property
2007-11-30 08:53:05 · answer #10 · answered by Anonymous · 2⤊ 0⤋