Information for tenants in foreclosed buildings

Are you renting in a building that has been foreclosed? Read below for information on your rights and protections.

The foreclosure crisis in the Commonwealth also affects tenants. If your landlord has been foreclosed on, there are a number of rights to be aware of to protect your housing. The new owners of the building are legally required to post their names and addresses in the building. You can also find the owner through a "Property Search" at the Registry of Deeds.

Eviction

As a tenant, you cannot be forced to leave the property until the owner of the building evicts you. They must file a court action to evict you and only a judge can order you to leave. If you receive a Summons and Complaint, you should follow the instructions and attend all hearings. Legal advice is helpful, but you do not need a lawyer to attend court or respond to the new owner’s complaint.

The law in Massachusetts offers protections that may stop the new owner from starting eviction process or ending your lease. 

Bona Fide tenants protections

Massachusetts law provides significant protections to tenants who are "bona fide' tenants. A bona fide tenant is a tenant who:

• Moved into the property before the foreclosure;
• Is not related to the former owner; and
• Had no business or personal relationship with the former owner.

Generally, a foreclosing bank cannot end the lease of a bona fide tenant or ask you to leave unless the bank has just cause.

The law limits just cause eviction to instances where the Tenant is:

• failing to pay rent;
• violating terms of the lease;
• causing a nuisance;
• using the property for an illegal purpose;
• refusing to sign a written renewal after the expiration of his lease;
• refusing the new owner reasonable access to make repairs or improvements as required by law.

Your responsibilities as a tenant

The responsibilities of a tenant do not change after a property is foreclosed upon. To protect your right to remain at the property, you must continue to meet your obligations.

First, you must continue to pay rent.  Sometimes, after a foreclosure, it is not clear who is the new owner of the property. The law requires the foreclosing owner to post notice of the new owner in a prominent location in the building and prohibits a new owner from evicting based on a tenant's failure to pay rent until 30 days after posting the required notices. If you have not received the notice, the best option is to place the monthly rent in a separate bank account so that you have it if the new owner claims you failed to pay rent. If you have a rental subsidy, let the subsidy agency know about the change in ownership, so that they stop paying the previous owner. You should have additional eviction rights because of your subsidy.

Second, you must continue to follow the terms of the lease. The new owner cannot evict you for failure to follow other parts of the lease until 30 days after posting the required notice. But the landlord can evict sooner if you are: 1. creating a nuisance, 2. using the property for an illegal purpose, or 3. have refused the new owner reasonable access to make necessary repairs or improvements.

Your rights as a tenant

As a tenant, you have the same rights as before a foreclosure. Even if a bank takes over the building, they are still legally responsible for maintaining it. If you are having problems with repairs or services that the owner is supposed to provide, such as utilities, then, you should contact the bank, its broker, or its attorney and let them know what is needed. It is best to contact them in writing.

If the utilities that the owner was supposed to provide (like water, common area lights, or heat or hot water) have been shut off or threatened with shut off, then, let the bank or the broker know. Call the Inspectional Services Department in your city or town and report the shutoff. You may be able to keep service on by paying a projected bill and can deduct these payments from any rent due. You may also be able to get an order from the Housing Court ordering the bank to pay the utilities.

If you give your former landlord a security deposit then, you should send a written demand to the former or current landlord asking for it back. The new owner may also be responsible for the security deposit. If you do not receive the deposit from the old owner and the new owner does not notify you within 45 days that it has your deposit in an interest earning account, send a security deposit demand letter to the new owner.