Foreclosed Marin Homes as Rentals?

Freddie Mac announced today it will allow some homeowners to rent out their homes after losing them to foreclosure. (http://news.yahoo.com/s/ap/mortgage_giants_renters)

Marin rentals and the effects of foreclosure is a hot topics with some of our tenants. Today's well-qualified tenants have valid concerns:

-- What happens to me and my family if I rent a home that suffers foreclosure?

-- What happens to my security deposit?

-- Will I be evicted even if I keep paying rent?

These are all valid concerns, however, due to ever changing legislation, tough to answer.

My understanding (and, of course, I am not a lawyer and my advice is not to be considered legal advice) is that once a home is foreclosed on, the bank is now the tenant's landlord. Rent should always be paid every month, otherwise the tenant risks defaulting on their rental contract and puts himself in a position to be evicted.

The Fredie Mac announcement today provides good news for tenants looking to stay in bank-owned Marin homes, but still probably doesn't answer the question about what to do next if your home falls into foreclosure.

The bottom line is that while the bank doesn't want to be a landlord, the bank also doesn't want to lose more money than necessary. If you are a tenant and you receive a notice of foreclosure consult a local tenant's attorney asap. You probably have more options than you think! (And hey, if you love the house you might even be able to purchase the property at a rock bottom price!)

My partners and I specialize in Marin Rentals and are happy to answer questions from landlords or tenants anytime.