Federal, state laws protect tenants living in foreclosed properties

A report says that about 40 percent of the millions of property owners facing foreclosure involve tenants who are renting a house, apartment or condominium. Federal and state laws give them protection so they don't have to move quickly.

Q. I rent a small single-family home and have made all of my monthly payments on time. However, the landlord's bank recently sent me a letter stating it is foreclosing on the landlord and that the property will be sold at a public auction. What are my rights in this situation?A. It depends on where you live, because laws regarding tenants' rights in foreclosure proceedings vary from one state to the next and sometimes even from one county to another. Much has been written about the millions of homeowners and rental-property investors who are currently suffering through foreclosure proceedings. But little has been said about the rights of tenants who live in a property that the owner's lender is about to "take back," whether it's a single-family home, condominium or apartment building.Some recent reports suggest as much as 40 percent of all Americans who may be displaced by foreclosure are renters in a home or apartment whose landlord can no longer meet the bank's property-mortgage payments and taxes. The federal government provides tenants nationwide with some basic legal protection through the "Protecting Tenants at Foreclosure Act" of 2009. They include the right to receive at least 90 days' notice before being required to move out and, in many cases, the right to remain in the property until any lease they have signed expires for several months more.Several counties and states also have passed laws that provide even more protection to renters who live in a property that is in foreclosure. If those state laws provide tenants with greater rights, they supersede the federal rules. Still, a new report by the nonprofit National Law Center on Homelessness and Poverty finds that several lenders and foreclosure investors are flouting tenants' legal rights. Some illegally order tenants in a rental property to vacate immediately; others provide unclear or misleading information that only an attorney can decipher, while still others simply refuse to communicate with a renter at all. Even investors that offer "cash for keys" programs that provide a lump-sum cash payment to tenants who agree to move out of a foreclosed home quickly often fail to inform renters that they can instead remain in the property for at least 90 days if they choose to do so.The National Law Center's new report, "Staying Home: The Rights of Renters Living in Foreclosed Properties," provides an overview of tenants' rights under federal law and a breakdown of additional protections that each state has approved. Download a free copy of the report from the group's website, www.nlchp.org. Then contact your local rent board, fair-housing organization, legal-aid office or a private attorney to see if even more rights are granted to tenants facing eviction due to foreclosure in your particular community.Q. We have some nasty oil stains on the cement floor of our garage, and all the scrubbing we've done hasn't been enough to get the stains out. Do you have any ideas to get rid of them?A. Probably the best and safest method is to scatter some store-bought kitty litter on the stains to soak up any excess oil. After sweeping it up, add some hot water to a cup or two of dry dishwasher or laundry detergent and use the resulting paste to scour the stains with a stiff brush before rinsing the spots with a garden hose.If that doesn't work, you can spray the stains with a commercial oven cleaner and then start scrubbing after letting the foam stand for several minutes. But remember that most oven-cleaning sprays have potentially dangerous chemicals in them, so keep children and pets away from the stains that you have scrubbed and then rinse the area thoroughly.Q. My wife and I are interested in forming the type of inexpensive living trust that you recently wrote about so our kids can inherit our home quickly when we die instead of spending lots of time and money in probate court. But if we create a trust, would we have to file the trust documents with the courts or the state?A. Probably not. A trust is essentially a private document, so its creation does not need to be reported to the courts or other agencies. And, unlike a common will, details of a trust that you create will not be subject to inspection by the general public after you die - an important benefit if you would like to keep your final wishes away from prying eyes.A few states have laws that technically require the registration of a newly formed trust, but none of them has ever imposed a penalty on those who ignored such a requirement. Judges also are loathe to set aside a trust that was created by homeowners who leave their property to their kids or other heirs, provided that the trust was made when at least one co-signer had the mental capacity to sign it.bull; For the booklet "Straight Talk About Living Trusts," send $4 and a self-addressed, stamped envelope to David Myers/Trust, P.O. Box 2960, Culver City, CA 90231-2960.