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    prman42's Avatar
    prman42 Posts: 2, Reputation: 1
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    #1

    Nov 1, 2011, 07:52 PM
    Breach of lease agreement by landlord.
    I signed a lease for 12 months that started March 1st of 2011. I received a phone call from the landlord a week and couple of days ago informing me that he has not been paying the mortgage for 3 months and now the bank is going to foreclose the property. The landlord is filing bankruptcy within a couple of weeks. One of the topics of the phone call was the rent and should I continue to pay it. The landlord said no "I don't need your money as I am filing bankruptcy". My question is did he breach the contract by his actions? Second question is now he is saying he has to go back on what he said and would like me to pay rent, what should I do?
    Fr_Chuck's Avatar
    Fr_Chuck Posts: 81,301, Reputation: 7692
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    #2

    Nov 1, 2011, 07:58 PM
    No he is not in breach of the contract ( unless foreclosure status is mentioned) In fact if both of you had agreed not to pay, and had written it up and both signed it, it would have been part of the contract and valid

    You owe and have to pay the rent, till the day it sells ( to this owner) as soon as it sells, you owe and will need to keep paying the new owner.

    After it does sell to a new owner ( even if that is the bank) you should have at about 90 days to move.
    AK lawyer's Avatar
    AK lawyer Posts: 12,592, Reputation: 977
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    #3

    Nov 1, 2011, 08:05 PM
    Quote Originally Posted by Fr_Chuck View Post
    ...
    After it does sell to a new owner ( even if that is the bank) you should have at about 90 days to move.
    At least 90 days. See the sticky near the top of this subforum. And it very well may be that the new owner will want to keep the existing tenants, so you won't have to move at all.
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
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    #4

    Nov 2, 2011, 03:21 AM
    Have you thought of offering to buy? If the property will be going into foreclosure, the bank may accept a short sale.

    But, as has been noted, there is no breach of the lease. The lease MUST be honored by the new owners, so you will have until March of 2012 to vacate. And yes you are required to continue to pay rent to whoever the owner is.

    If you want to move sooner, you can ask the landlord for permission IN WRITING to vacate early.
    AK lawyer's Avatar
    AK lawyer Posts: 12,592, Reputation: 977
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    #5

    Nov 2, 2011, 04:52 AM
    Quote Originally Posted by ScottGem View Post
    ...
    If you want to move sooner, you can ask the landlord for permission IN WRITING to vacate early.
    But if he does file for bankruptcy, this decision might not be his to make.

    And be aware that the bankruptcy might be part of a strategy to stave off, or avoid entirely, the foreclosure.
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