Another foreclosure, another botched investment… right?  Wrong.  Many times, the cut goes much deeper than that.  With the majority of investment properties leased out to renters, a foreclosure has often led to the disruption of life for the renting family.

The owner of a property is typically well versed on his or her rights.  They may have an attorney.  If not, help is on the way with one call or click of the mouse.  A foreclosure is a problem for any owner, but at the end of the day, that owner bears some, if not all, the culpability for the financial misstep.

But what of the renter; the person who paid the rent on time and fulfilled their end of the bargain?  What rights do they have when their landlord took their rent payments and never made the mortgage payments?  This may be a bigger problem than you realize.  According to Shannon Behnken in the Tampa Bay Online, in an article titled, “Warning to landlords in foreclosure: renters have new housing rights,”

As the economy struggles, Florida’s foreclosure rate continues to tick up. Investors who bought rental homes during the housing boom and can’t afford to keep them are walking away.
Nationwide, about 40 percent of families facing eviction are renting from landlords with homes in foreclosure, according to the National Low Income Housing Coalition.

New laws have been passed to protect renters rights.  The problem here is the same as it always is when it comes to legislation: awareness and enforcement.  Behnken also states,

But here’s the part of the story too many people haven’t heard yet: It didn’t have to happen that way.

Historically, renters haven’t had many rights if their landlord stopped paying the mortgage. A lender took back the home and the renter was forced to vacate.

But with so many renters getting tossed out, Congress changed the rules in May. The Protecting Tenants at Foreclosure Act says renters must be given at least 90 days to leave. In some cases, renters can stay even until their lease expires.

But, like Smith, so many renters have never heard of the new law and have no idea how to protect themselves from this type of situation in the first place.

So there are governmental mandates in place but no rent police on patrol.  Is it a hopeless situation for renters?  Do renters really have rights or should they just take what they can get?  There is hope and there are measures to protect yourself, if you are a renter.

So what can renters do?

First, don’t sign any lease before checking your county’s court records to verify that the home isn’t already in foreclosure. Keep in mind, however, that suits are not typically filed until owners are at least three months behind on payments.

Finding the foreclosure status of any real property in the US is a simple as going to Lemon Landlord’s site and typing in the address.  You get an instant report and best of all, you can have that property monitored for you.

Renters, don’t wait on the government to take care of you.  Take control, and don’t be a statistic.