Tenants renting a home must receive notice upon foreclosure sale.
Civil Code §2924.8
Amended by A.B. 2610
Effective dates: March 1, 2013 – December 31, 2019*
The notice of sale to be posted with the notice of trustee’s sale on a residential property in foreclosure has been amended to read:
(Changes are indicated in bold)
“Foreclosure process has begun on this property, which may affect your right to continue to live in this property. Twenty days or more after the date of this notice, this property may be sold at foreclosure. If you are renting this property, the new property owner may either give you a new lease or rental agreement or provide you with a 90-day eviction notice. You may have a right to stay in your home for longer than 90 days. If you have a fixed-term lease, the new owner must honor the lease unless the new owner will occupy the property as a primary residence or in other limited circumstances. Also, in some cases and in some cities with a “just cause for eviction” law, you may not have to move at all. All right and obligations under your lease or tenancy, including your obligation to pay rent, will continue after the foreclosure sale. You may wish to contact a lawyer or your local legal aid office or housing counseling agency to discuss any rights you may have.”
The amended notice must also be delivered via first-class mail to the resident of the property in foreclosure.
This notice will be translated into Spanish, Chinese, Tagalog, Vietnamese or Korean by the Department of Consumer Affairs (DCA). The use of this notice will be required the later of March 1, 2013, or 60 days after the DCA posts the required translations on its website.*
This law will sunset on December 31, 2019.
90-day notice to quit due to foreclosure extended to periodic tenancies
Use of the 90-day notice to quit in the event of foreclosure sale
Code of Civil Procedure § 1161b
Amended by A.B. 2610
Effective dates: January 1, 2013 – December 31, 2019
To terminate the periodic tenancy of a tenant who occupies a residential property at the time the property is sold in foreclosure, the tenant must receive at least 90 days’ written notice to quit.
Residential tenants with a fixed-term lease entered into prior to the foreclosure sale will have the right to possess the rented property until the end of their lease, unless:
- the new owner will use the property as their primary residence;
- the tenant is the current owner of the property who has defaulted on the mortgage;
- the tenant is the child, spouse or parent of the current owner;
- the lease was not the result of an arm’s length transaction; or
- the rent was substantially less than fair market rent without subsidization or reduction per court order.
A fixed-term tenancy can be terminated for any of the above reasons by serving the tenant with a 90-day notice to quit. [See first tuesday Form 573]
The new owner bears the burden of proof in establishing the tenant is not eligible to possess the property through the end of the lease term.
This law will sunset on December 31, 2019.
Editor’s note — In practice, the 90-day notice requirement was already in place via the federal Protecting Tenants At Foreclosure Act. However, the notice referenced the California 60-day notice requirement, with only an oblique reference to the longer federal notice requirement (“other laws…may provide you with a longer notice [period]”). Adopting the federal language and amending the notice will provide tenants with an accurate and clear declaration of their rights.
