Tenants' Rights When a Home Goes Into Foreclosure in Florida
Facing among the highest foreclosure rates in the country -- almost a half million in 2010, according to CNBC.com -- Florida homeowners and tenants have only limited protections once a property has been foreclosed upon. Tenants, in particular, look to both federal and state law provisions to help them through this formidable situation.
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Federal Law Carries the Greatest Protections
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Unfortunately, one of the first actions a lender takes after foreclosing on a property is to evict the tenants. The federal Protecting Tenants at Foreclosure Act of 2009 aims to extend tenant rights in this circumstance. The law requires foreclosing lenders to honor existing leases and to provide tenants with at least 90 days notice before commencing eviction action in court. Prior to passage of the law, any existing leases were voided at the foreclosure sale, and evictions required only 30 days' notice. The law provides an exception to any buyer who purchases the property at foreclosure and intends to move in; in these cases, the lease is voided but owners must still provide 90 days notice to the tenants before moving in.
State Law Prohibition
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Florida is one of 35 states that preempt local rent control. Rent control provides one of the strongest protections to an eviction that comes on the heels of foreclosure. Tenants who live in units protected by rent control cannot be evicted without just cause, such as failure to pay rent or a violation of non-rent lease provisions. Foreclosure is not a just cause under rent control provisions, and so tenants cannot be evicted as long as they continue to pay rent.
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State Law Protections
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Basic tenant-landlord regulations in Florida provide some additional protection to tenants living in a property that is being repossessed. During the foreclosure process, landlords who know they will be losing the property have no incentive to maintain it. Florida state law requires the owner to comply with requirements of local building, housing and health codes. At foreclosure, the property owner rarely transfers the tenants' security deposits or last month's rent to the foreclosing lender. State law requires the landlord either transfer the funds to the new owner or return them to the tenant. If he has not, a tenant can file an action against the landlord in small claims court.
Local Court Support
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To make certain both tenants and foreclosing lenders are aware of the law, the 11th Judicial Circuit court, which covers Miami-Dade County in Florida, requires all writs of possession -- which are the court-issued documents allowing lenders to evict tenants -- to refer to the Protecting Tenants at Foreclosure Act. This keeps lenders honest and makes sure tenants are not evicted before they receive the 90-day notice.
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- Photo Credit Sold Home For Sale Sign on Burst image by Andy Dean from Fotolia.com
