Legal Question in Real Estate Law in California

Re: rent on defaulted property

There is a practice called "rent skimming" which is made illegal by the Civil Code and for which a tenant may have a cause of action. I suggest you find the Civil Code on line or at a law library (it's a bit too lengthy to quote or discuss here) and study sections 890 through 893, especially section 891(d), noting that the landlord may have jeopardized your security deposit.

Outside of this law, which creates a duty by the landlord to apply a tenant's rent to the landlord's loans against the rental property, I'd think there might be a common-law (non-statutory) cause of action for breach of the so-called covenant of quiet enjoyment, which really amounts to an implied warranty by the landlord that the tenant's possession and use of the leased premises will not be challenged by anyone, such as other claiming to be tenants or new owners following a foreclosure. The foreclosure hasn't happened yet, I guess, but it seems sufficiently threatened so that there is now a breach of the covenant.

In either approach, your suit would be for actual damages, not a specific amount of back rent, and under 891(d) you might also get punitive damages.

If there is a foreclosure sale, the foreclosure will wipe out your lease unless you have the unusual situation where the loan being foreclosed is junior in time of creation to your lease, in which case the foreclosure buyer takes the property subject to your lease. If your lease is wiped out, whether you can remain as a tenant is up to the new owner or possibly any local eviction-control law in your city.

This is kind of a theoretical analysis, because whether it is practical to sue or not requires you also to consider the likely amount of your damages, the time and cost to bring suit, whether the landlord has any money or property to satisfy a judgment, and other issues.

Re: rent on defaulted property

Your landlord's default should be of no concern to you. You have a rental agreement with the landlord to pay monthly. Until notified otherwise, that is what you are contractually obligated to do.

If the property is foreclosed, you will be notified by the new owner to whom to pay rent. Then you might contact the new owner to make arrangements to remain, or to vacate.