Sale of Property During a Lease

The term eviction refers to the legal process in which a court orders the removal of a tenant from a rented apartment or home. This removal is based on a request from the landlord, who must have a justified and specific reason as to why the tenant should be evicted from the property. Eviction should not be taken lightly, as the process could leave the tenant facing homelessness.

Some of the reasons as to why the landlord may wish to evict a tenant from a rental property include:

• The tenant has stopped paying rent for a specific amount of time;
• The tenant or their guests have caused substantial property damage;
• The tenant has breached the terms of their lease or rental agreement such as smoking in a non-smoking building; and
• The tenant does not move out once their lease has expired, and is now considered to be a squatter.

Most eviction actions occur between a tenant and a landlord, who are associated with a residential property site such as a home or apartment building. However, the process can also be used to remove tenants from rented commercial buildings as well, such as business offices.

It is important to note that the eviction process generally involves many steps which have strict legal requirements for both the tenant and the landlord. Such requirements are governed by specific state laws; meaning, they will vary according to jurisdiction, or where the eviction takes place.

Once again, eviction can leave a tenant homeless, so it is imperative for the landlord to take the time to consider that fact before proceeding. The law has traditionally supported landlords in terms of evictions. More recently, courts are likely to side with the tenants, especially as more examples of landlord abuse and exploitation are revealed. Tenants have a number of defenses which they may be able to use against a landlord’s eviction notice. These defenses can help prove that the eviction is unfair, or that there is no legitimate reason to evict them from their home in the first place.

Can a Landlord Evict Me From My Home In Order to Sell The Property To Someone Else?

Whether your landlord has the legal right to evict you on the grounds of wanting to sell the property is a complicated matter that can vary greatly from state to state. Cities that maintain a rent control ordinance will most likely require landlords to have a better legal reason for displacing someone from their home “just because.” This fact remains regardless of what the rental agreement states.

First and foremost, your landlord can only evict you in order to sell the property if your lease contains a provision stating as much. Generally speaking, such a provision must be in writing and any agreement or statement made orally will not suffice. Many of the form lease agreements used by homeowners when renting to a tenant contain some sort of language clarifying how many days’ notice they must give the tenant if they intend to evict them to sell the home.

This timeframe ranges between thirty and sixty days. Because of the 2008 spike in foreclosures, specific federal laws have been created for the sole intention of protecting renters from losing their leases.

If the lease contains no such provision stating that a sale of the property would automatically terminate your lease, nothing will change and the property’s new owner would step into the position of being your new landlord. This new owner would take on all of the rights and responsibilities that your old landlord had as owner of the property.

The type of lease agreement will also have an influence on the tenant’s rights. Some examples of this include, but may not be limited to:

• Fixed Lease Period: If the rental agreement specifies a time period for the property lease, the tenant has the right to remain in the rental property for that specified amount of time, and/or until the end of the lease. This is regardless of whether the landlord sells the property. The lease would survive the sale of the property, with the new owner stepping into the role of landlord without signing a new lease with the current tenant;
• Special Lease: An example of a special lease would be how some leases contain agreements which state that the sale of the property by the landlord automatically terminates the lease. In such cases, the tenant must either move out or sign a new lease with the new owner. However, as previously mentioned, such an agreement would violate local law. All parties involved would need to consult with an attorney before moving forward; or
• Month to Month Lease: Under such an arrangement, the landlord has the right to sell the property while also giving the tenant notice to vacate the property without giving them a reason for doing so.

What About the New Owner? Can the New Owner Evict Me, Or Raise My Rent?

When a landlord sells their property, the new owner is generally bound by the existing lease. What this means is that they can only evict an existing tenant if there is a legally recognized reason for the eviction, such as those previously mentioned. Additionally, the new owner cannot legally raise the tenant’s rent in the middle of an existing lease. This is due to the fact that the new landlord has an obligation to adhere to both the length and terms of the existing lease.

This remains true even if the new owner was not informed of existing leases, because most state laws assume that the new owner should have questioned whether there were existing leases. Or, the new owner should have otherwise discovered existing leases if they acted with due diligence.

In short, it is not the tenant’s problem if the new owner or the buyer was not aware of the lease. The new owner is responsible for dealing with this matter with the previous landlord. If the new owner were to purchase the property and the lease between the tenant and the landlord did not automatically terminate the tenant’s lease, the new owner is legally obligated to step into the role of the previous landlord. This entails assuming all of the rights and responsibilities of the previous landlord.

Many landlords fail to remember that their tenants are human beings when they are pursuing eviction, and forget that they will be displacing someone from their home. While it seems like tenants have the majority of rights in a landlord-tenant relationship, the landlord still has a large number of rights over the tenant.

Some lease terms which favor the landlord include:

• Late Fees: Late fees may be charged if the rent or security deposit is late. Such a contract term could also be included in the section of the lease addressing rent or security deposits. However, it is not uncommon for late fees to be a separate term within the contract;
• Acceleration: This term allows the landlord to demand full payment of rent if the lease is breached. An example of this would be if the lease requires $200 per month for a year, and the lease is breached in June. The acceleration clause gives the landlord the right to demand that the remaining $1200 is paid all at once; and
• Merger: A merger clause forbids previous agreements outside of the lease from being used in order to modify the lease. Any changes once the lease has been made must be in writing.

Do I Need an Attorney For Issues Associated With the Sale Of Property During a Lease?

Whether you are the landlord, the tenant, or a potential buyer, you should consult with an experienced and local landlord and tenant lawyer before moving forward with the sale of property during a lease. State laws vary widely in terms of what is considered to be illegal, and, thus, working with an area attorney will ensure that you receive the most relevant legal advice according to your state’s specific laws.

An attorney can also help you determine the legal rights and responsibilities of all parties involved. Finally, an attorney will also be able to represent you in court, as needed, while protecting your legal rights.