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  1. #1
    Join Date
    Aug 2016
    Posts
    1

    Default What Happens to a Tenant if a Rental Home is Sold at Auction

    My question involves landlord-tenant law in the State of: Texas

    My family moved into this house in January of 2010. We were renting from a friend. In the fall of 2011 they defaulted on the mortgage after the death of one of the owners. Shortly thereafter we stopped paying rent. Our surviving friend had no dispute with us for this action as she was no longer paying a mortgage payment. She knew we would be forced to find housing eventually.

    Little did we realize it would be about 5 years before things would start happening. My friend just received an Auction Notice. She gave me the heads up or we would have never known the time was upon us. The property will be auctioned on Sept 6, 2016.

    We are considering bidding on the house, but I doubt we have enough savings for a winning bid.

    I need to prepare myself for eviction. There is no lease agreement. We are not in a rent agreement at all so we are not breaking any agreement with the previous owner.

    As of today we have received no communication directed to us as the current tenants. I assume that taxes are owed for the 5 years the house has been in this process.

    What are my options? How can I safely maximize our time in this house while we seek new housing?

    There are 6 of us! Me, my wife and 4 kids. I really need to think this one thru:-)

    Thanks in advance for any advice given.

  2. #2
    Join Date
    Sep 2010
    Posts
    19,901

    Default Re: Auction Nearing on the House I Live In

    It depends on just what sort of auction this is. If it is a foreclosure in Texas, you're lease is dissolved by the foreclosure, the new buyer can start eviction proceedings immediately. You can be ordered out in as little as eleven days (depending on how the court schedule is in your county). There is no communication required prior to them telling you they want you out.

    If the auction is not a foreclosure, but just the lender (or whoever) trying to dispose of the property, then your lease remains in effect. If you don't have a lease, then you really aren't in much better shape, they can ask you to leave in 30 days.

    Buying at auction requires you to have the CASH to pay for your bid in short order. If you have to finance it, you're likely not going to be able to pull it off. Note that in foreclosures, there's rarely a bargain. The bank will bid what they have in the property.

    So, what do you do. You need to do a two pronged approach.

    First, start looking for somewhere else to live. As indicated above, your days may be numbered.

    Second, wait until the property is sold. If it's a foreclosure, the bank will typically end up owning it as a REO. You can then try a few things:
    1. By the property from the new buyer (this will allow you to obtain conventional financing).
    2. See if the new buyer is willing to continue renting to you. Banks may be willing to do so if you can keep the place neat and tidy while they try to sell it.
    3. See if the buyer will offer you "cash for keys" to move out in a timely and undamaging fashion without them having to resort to a judicial eviction.

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