Legal Question in Real Estate Law in California
3 day pay or quit
we have been renting and paying rent faithfully for 11 months now. We found out last month that the landlord has not made any mortgae payments in 8 months and the home is in foeclosure. The house goes up for auction july 3rd. Are we still required to pay her rent? We did not pay this month and she served us with a 3 day pay or quit. Can she recover from this?
4 Answers from Attorneys
Re: 3 day pay or quit
You should be able to stall the eviction lawsuit until after the foreclosure sale. Then your problem becomes getting your security deposit back from the bank. Read caltenantlaw.com .
Re: 3 day pay or quit
My gut instinct is not to pay, and if need be, I could come up with some legal theories on why you are excused from paying. For example, the Notice of Default and the Notice of Sale would be breaches of the landlord's covenant of quiet enjoyment, and the likelihood of a foreclosure sale and a new owner taking possession is an anticipatory breach of the lease.
The landlord can reinstate any time up to the date of sale by paying the amount in arrears to the lender, which presents an element of uncertainty into any calculation of your risk in withholding rent, but at this point reinstatement is unlikely even if you paid the rent.
Taking the three-day notice and adding on the time to get an unlawful detainer matter to trial, the trial would be after July 3rd in most counties. If served with an UD suit, you should answer and assert the landlord's breach as a defense. That will force the UD matter onto the court's busy calendar. By the way, you would probably win.
However, I think the landlord is somewhat unlikely to file a UD, since he or she is likely going to lose possession anyway before the matter could be tried; the three-day notice is probably just an attempt to squeeze some last-minute cash out of you.
Re: 3 day pay or quit
She is entitled to rent until she no longer owns the property. That being said, allowing the property to go to foreclosure is an anticipatory breach of the lease. I'd move out.
Re: 3 day pay or quit
The law is not clear on this issue. The safe thing to do would be to pay your rent. It is foreseeable that the sale date will be cancelled or continued, in which case the landlord may very well sue you in Unlawful Detainer Court. And believe me, you do not want an eviction on your credit report because no one will rent to you. After the property sells at a foreclosure sale, you would no longer have an obligation to pay rent because you would no longer have a landlord. The buyer of the property at the foreclosure sale is requireed to give you a 30 day notice, and sometimes will enter into a new lease agreement with tenants on the property. So, I would say pay June's rent, but do not pay July's until after the date set for the foreclosure.