Frequently Asked Questions

Legal Hotline FAQ

a blog of the most frequently asked questions to the MAR legal hotline.


Cindy Sellers
Cindy Sellers
Cindy Sellers's Blog

I know that there have been a lot of laws passed regarding the rights of tenants after a foreclosure.

Sections 7-105.6 and 7-105.9 of the Real Property Article of the Maryland Code address the rights and remedies between foreclosure purchasers and tenants and the notices that must be provided to an occupant during the foreclosure process.  The legislation includes protections for “bona fide tenants” and clarifies how those protections apply in Maryland.  Before the foreclosure sale occurs, the foreclosing bank or foreclosure attorney must send notices to “occupants” on two separate occasions. Each notice includes a lot of required information, set forth in full in the statute.  The portion of the statute which explains the tenant/occupant’s rights is as follows:

 

Most renters have the right to continue renting the property after it is sold at foreclosure. The foreclosure sale purchaser becomes the new landlord.

Most renters with a lease for a specific period of time have the right to continue renting the property until the end of the lease term. Most month–to–month renters have the right to continue renting the property for 90 days after receiving a written notice to vacate from the new owner.

You should get legal advice to determine if you have these rights.


If the foreclosed property has not been purchased by an owner who will use the property as his or her primary residence (an “owner-occupant”), the new owner takes possession of the property subject to any leases on the property. The new owner must allow the tenant to continue renting the property until the later of (i) the end of the lease term, or (ii) 90 days from the date that notice of termination of the tenancy is given to the tenant.  If an owner-occupant purchases the property, he or she can terminate the tenancy before the end of the lease term, but must provide the tenant with a 90-day notice of termination. For tenants who are no longer under a lease and renting at-will or month-to-month, the new property owner, whether an owner-occupier or not, must give the tenant 90 days’ notice before the tenant has to leave.

If the foreclosure sale was advertised as being subject to 1 or more tenancies, those leases are unaffected by the sale, except the purchaser becomes the landlord, as of the date of the sale.  

Maryland Code Section 7-105.10 requires that tenants receive notice of who purchased the property at the foreclosure sale and how to pay rent. The foreclosure purchaser of a one-to-four-unit property may not collect any rent from tenants unless the purchaser conducts a “reasonable inquiry” into whether the property is renter-occupied and provides the tenants with contact information for the purchaser or property manager, if applicable. If the foreclosure purchaser doesn’t provide the required notice, the purchaser waives the right to collect rent until he or she complies.

If the purchaser determines that a tenant resides in the foreclosed property (after making a reasonably diligent inquiry), the purchaser must give proof that the proper eviction notice under Protecting Tenants at Foreclosure Act has been given and that the tenant has no further right to possession before a court would consider a motion for a judgment of possession.



Comments are closed.