Question Details:I have 16 months left on 3 year bona fide lease on our Colorado Spring, CO home. Owner wants to sell before foreclosure sale . No sale/transfer clause in lease, nor does it require me to show property, but owner is marketing anyway. Are buyers obligated to honor the term of my lease? If not, what can I do to protect myself from new owners terminating lease, and what are notice to vacate requirements? If buyer does not honor lease, can I file breach of contract suit against old or new owner? Please clarify impact of PL111-22 if house is foreclosed, particularly if bank retains at foreclosure sale?
Your rights in foreclosure are different from your rights with the new bona fide buyer. In foreclosre the Federal government has enacted a Bill that allows tenants more time and rights in the foreclosure process.
As for the sale, each State has there own rules concerning whether or not a buyer of a property can end a signed lease agreement (terminate in legal terms) between a tenant and the prior owner of record prior to the expiration of the lease agreement.
In some States a lease agreement comes with the property or as some say "runs with the land". The new owner must honor the current lease agreement that a tenant may have. In other States there is no requirement. If the tenant stays after the deed is transferred eviction proceedsing will most likely begin. Most states have 30 day notice requirements.
Contact your State's Real Estate Commission or contact a Real Estate Attorney in your area.
Foreclosure terminates leases; in that sense, it is very different from a home or building being sold voluntarily, even in a "short sale" for less than the loan balance. Whomever buys the house in foreclosure is not bound by the lease. However, that does not necessarily mean you can be evicted right away; under what I believe is called the "Saving Our Homes Act" (or something very similar), signed into law last year, if a foreclosed properety has residential tenants, the tenants get a minimum of 90 days notice to vacate, and possibly are allowed to finish out the balance of their lease term. Look up the law to see how it might apply to your situation; note that the application of the law is different if the home/building is bought by an investor or developer vs. if it's bought by someone who hopes to live it him/herself. (In the latter case, they can evict more quickly.)