Foreclosure Investors Beware: Existing Tenants Cannot be Evicted

The Protecting Tenants at Foreclosure Act of 2009 expired on December 31, 2014. Now it is back again.

The law prevented new owners from evicting tenants after a foreclosure, and was passed as a result of widespread hardships after the collapse of the mortgage markets. By 2014, it was felt that such protections were no longer necessary.

Despite today's booming economy, the law has now been revived. On May 24, 2018, President Trump signed into law a bill which contained major rollbacks to the Dodd Frank Act. It ALSO revived the Protecting Tenants at Foreclosure Act of 2009. The effective date is 30 days after the President's signature.

Yes, folks, it's back. Tenants cannot be evicted after a foreclosure, and can stay until the expiration of their lease term. The only exceptions are if the rent is dramatically below market (whatever THAT means) or if the tenant is closely related to the borrower.

I'll research this a little more thoroughly in the coming days, and post again. Right now, this is a "Heads Up" that you might not have heard about on Fox or CNN or any place else.

In case you are interested, here is what Section 304 of the brand new "Economic Growth, Regulatory Relief, and Consumer Protection Act” says:

"RESTORATION OF THE PROTECTING TENANTS AT FORECLOSURE ACT OF 2009.

(a) Repeal Of Sunset Provision.—Section 704 of the Protecting Tenants at Foreclosure Act of 2009 (12 U.S.C. 5201 note; 12 U.S.C. 5220 note; 42 U.S.C. 1437f note) is repealed.

(b) Restoration.—Sections 701 through 703 of the Protecting Tenants at Foreclosure Act of 2009, the provisions of law amended by such sections, and any regulations promulgated pursuant to such sections, as were in effect on December 30, 2014, are restored and revived.

(c) Effective Date.—Subsections (a) and (b) shall take effect on the date that is 30 days after the date of enactment of this Act."