Good News For California Tenants Whose Landlords Received Foreclosure.

28 Aug Good News For California Tenants Whose Landlords Received Foreclosure.

On July 8, 2008, California passed urgency legislation that extends the time period that tenants have to vacate property recently foreclosed.

Under previous laws, tenants were to be provided a 30 day notice prior to eviction proceedings being filed.  Now the law provides that tenants are entitled to 60 days.

Specifically, Code of Civil Procedure section 1161b states

(a) Notwithstanding Section 1161a, a tenant or subtenant in possession of a rental housing unit at the time the property is sold in foreclosure shall be given 60 days’ written notice to quit pursuant to Section 1162 before the tenant or subtenant may be removed from the property as prescribed in this chapter.

(b) This section shall not apply if any party to the note remains in the property as a tenant, subtenant, or occupant.

The one exception, however, is that it does not apply to borrowers on the loan.  But if you are part of a family unit, or other people live in the home with the borrower, such a provision essentially may have no effect since the other people in the household are still entitled to the 60 day notice.  To get around this exception, the lender would need to prove that the borrower was still an occupant of the property to bypass this new law.

So assuming no answer is then filed in an eviction proceeding that is filed after the 60 days expire, a non-party to the loan can expect to remain in foreclosed property 60 plus 45 days for a total of about 3.5 months.  This time period might be extended as well if the eviction proceeding is contested, a bankruptcy is filed, or a wrongful foreclosure took place.

Written by Michael G. Doan

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