Is our house being foreclosed?

Question

We have been renting a house in west miami and our lease is up in April. We were served in October a letter from the court letting us know that the owner had not paid the mortgage since April 2009. The owner told us she could not pay because she was trying to modify her loan and to do that she had to be late with her payments. If the bank was not able to modify her loan she would let the house go to a foreclosure.

Today we got a letter from civil action court saying:

THIS CAUSE having come on to be heard upon Plaintiff's Motion for Default, and the Court having heard argument of counsel and being otherwise advised in the premises, it is ORDERED AND ADJUDGED:
Plaintiff's Motion for Default, is granted. A default is hereby entered in this action against Defendants: Owner;s name, spouse of owner, Tenant #1 my spouse and Tenant #2 me.

What does this all mean?
1. Since owner has our sec deposit and last month's rent, should we continue paying or allow her to use that $$ for the next two months rent
2. Should we start looking for a place to move?
3. Is the house being foreclosed?
What is the next step in this legal process?

BTW- rent here is expensive and we cant just get up and move because we dont have 3-months rent saved up to pay as 1st month, last month and sec deposit.

We had agreed last week to go month to month after our lease was up in april. She had agreed to reduce our rent by $200 also. Now I am not sure of what to do.

Marcus LaGrone · Answer

Sebastian, you have plenty of time. Even if the property forecloses in March, new laws make it impossible for you to be evicted earlier than 90 days from the foreclosure sale if you have a valid lease. In this time, you do not have to pay rent. On another note, the bank that is foreclosing will more than likely offer what is called Cash For Keys or Relocation Assistance. I would not move until you receive an offer or are contacted by the bank. When you receive an offer, make a counter offer. In our market, banks are paying up to $3000 in many instances for the tenant to vacate in 45 days.

Jason Wheeler · Answer

You can find out the Notice of Default and sale date from your County recorder or sometimes a title company. Here in CA the foreclosure process is often taking upwards of 1 1/2 years. You might be able to stay there rent free for quite some time.

James Ward · Answer

You can find all the info you want about the property on the Dade County Clerk of Courts. Just look up info by way of the property owners name. You will need to look for items that are for the Lis Pendens. If you want further advice what to do. Call into the Dade County Housing Authority. They can guide you to the rigth place.

Jon Holdman · Answer

You should also find out when the notice of default (or whatever its called) was filed. If your lease was filed before that, and it probably was, the 90 day window to move out that Bill mentioned applies. If the lease came after the notice, then your time window is much shorter. If there's any contact info in the letter, I'd be on the horn first thing in the morning asking questions. I'm not sure what a "motion of default" means. It seems unusual that you or your spouse would be mentioned in a foreclosure proceeding. You would be mentioned in an eviction proceeding. Can you provide more of what this notice says?

Bill Gulley · Answer

Notice of sale will be sent to the owner and maybe to you, if not to you, it will be published in the legal notices of the newspaper in your area. You can also find the sale date by contacting the Trustee of the Deed Of Trust securing the loan. If you know who the bank is, you can call them. And, the Cleck of Court where the judgement was rendered can point you in the direction of who and where the sale will be conduccted. Good Luck, Bill

Sebastian Reynolds · Answer

What is the sale date? Where do I find that? Thank you!

Bill Gulley · Answer

Hi, the property has been moved to foreclosure, the lender will be selling the property. From the date of sale, under federal law you have 90 days to move if you have a bonifde lease. As to rents, I would call the clerk of court and ask them about rents. I would not be paying it to the landlord. The court may be entitled to receive monies from that day of the judgement and held until the sale, this may vary from place to place. When the property sells, you should be getting a notice from the new owner or the lender stating when to vacate, you may want to record your lease at the courthouse, as they will be doing, if not already done, a title search. The new owner may rent the property too, and assume the same terms you had, so there is a chance that this will not really effect you, but be prepared to move 90 days from the sale date. Good Luck, Bill