Wednesday, February 23, 2011

Who Should Florida Tenants Pay Rent to When the Home They Are Renting is sold at a Foreclosure Sale?

Recently, I was asked a question by a client, who rents a home, what are his rights as a tenant when the property he is renting is in foreclosure. I advised him that as long as he is a bona fide tenant under the Protecting Tenants at Foreclosure Act (PFTA), that PFTA permits him to continue his tenancy for the remainder of his lease or 90 days from the date he received notice of the foreclosure, whichever is greater. However, the PFTA doesn't answer one interesting question; who does the tenant pay the rent to once the property is sold at a foreclosure sale? The simple answer is the new owner, but the answer may not be so simple. Often times the landlord/property owner who lost the property will file an objection to the foreclosure sale or file a motion to set aside the foreclosure judgment for various reasons. Even though a certificate of title has been issued and seemingly ownership has changed there remains a cloud hanging over title to the property because of the looming objection or motion. In light of all of the foreclosure fraud, we have advised some clients, our advice varies depending on the facts of each case, to continue to pay the landlord until the objection or motion is heard by the Court. However, each case is different and the prudent thing to do may be to pay the rent into the Court registry. It's recommended that you contact a local real estate lawyer to review your particular circumstances. The foreclosure mess just won't end.

Friday, February 11, 2011

Fannie Mae Fires Florida Foreclosure Law Firm Ben Ezra – Does The Court look at Foreclosure Files From That Office With an Extra Level of Scrutiny?

This isn't the apprentice, but someone got fired. It was announced yesterday that Fannie Mae fired Ben-Ezra & Katz, P.A. Ben Ezra is the second South Florida foreclosure firm that Fannie Mae has fired in the last couple of months. The Law Office of David Stern was the first to be fired for alleged document process irregularities. Fannie Mae sent a letter to Ben Ezra Thursday afternoon informing them of the news. A Fannie Mae spokeswoman stated that they "became aware of certain document execution issues at the Ben Ezra law firm regarding its processing of foreclosure cases on Fannie Mae's behalf." Fannie Mae advised its mortgage servicers to move any files currently held with Ben Ezra to other firms within Fannie Mae's Retained Attorney Network in Florida. Fannie Mae gave a February 15 deadline for servicers to find new firms to handle the Ben Ezra cases.  When we review a file for irregularities and it's a David Stern or Ben Ezra file, we look at the file with extra level of scrutiny; I wonder if the Courts do too? If you have lost your home to foreclosure or are in foreclosure and either of these firms are involved, I would have a foreclosure lawyer review it for signs of "issues." Most defense attorneys offer a free initial consultation. Anyway, I wonder who'll be next to be axed.