Can we lease to default borrowers of a foreclosed REO in TEXAS?

[Bhanu P.]

We closed a REO property in Texas and former owners are still living in the property and when we approached them to give 3 day notice, we learned that they are interested to lease from us for an year.

In normal situations, we do not entertain this scenario but they do qualify our rental qualification and they are so much motivated to stay in the house and wanted to buy it back in an year or so.

Note: We have not agreed to sell it or never given any option for them to buy it back from us. We anticipate these people can be potential long term tenants.

Question is, can we lease the property to foreclosed borrowers or do we face any legal challenges?

Is it going to be regular lease transaction and we can evict them in case of non payment of rent or do they still have any additional rights than the regular tenants since they own the property before mortgage foreclosure by their lender???

Like to hear from someone who did this and experienced the similar situation. Thanks in advance!!!