Short Sale, Foreclosure and Strategic Default

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Friday, May 22, 2009

New Federal Law Affecting Distressed Properties

From the California Association of Realtors -

LONGER STAY FOR TENANTS OF FORECLOSED HOMES: Effective immediately, an REO lender or buyer who acquires title through a foreclosure sale must give at least a 90-day notice to terminate a bona fide tenant as defined. A 90-day notice to terminate is sufficient for a month-to-month tenant or if a new owner will occupy the property as a primary residence at the end of the 90 days. Otherwise, a tenant with a one year or other fixed-term lease with a remaining lease term exceeding 90 days can stay in the premises until the remaining lease term ends. This new 90-day notice requirement applies to foreclosures of a federally-related mortgage loan or residential real property, except for properties under rent control, rent-subsidized programs (such as Section 8), or other state laws that provide additional protections for tenants. This law expires on December 31, 2012"

It will be interesting to see how this effects san diego real estate. This could keep foreclosure off the market for close to one year. I could see homeowners using this as leverage in short sale negotiations.

san diego short sales

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