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LEGAL UPDATES New Federal Law Affecting Tenants of Foreclosed Homes by Shannon B. Jones - June 2, 2009 During the week of May 18, 2009, President Barack Obama signed into affect a law entitled the Helping Families Save Their Homes Act of 2009. While the Act contains a number of provisions relating to loans, one important provision relates to notices to tenants to vacate when a property is sold pursuant to a foreclosure sale. Effective immediately, this law provides that an REO lender or other buyer who acquires title through a foreclosure sale must give at least 90 days notice to terminate a tenant. The 90-day notice applies to a month-to-month tenant or if a new owner intends to occupy the property as their primary residence at the end of the 90 days. Otherwise, a tenant with a one-year or otherwise fixed-term lease with a remaining lease term exceeding 90 days can stay in the premises until the lease term ends. This new requirement applies to foreclosures of a federally-related mortgage loan or residential real property, except for properties under rent control, rent-subsidized programs, such as Section 8, or other state laws that provide additional protections. The law is scheduled to expire on December 31, 2012.-Shannon B. Jones, Partner, sbj@sbj-law.com |
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