Legal Question in Real Estate Law in New York

Re: foreclosure - tenant rights

A coop "foreclosure" can be as simple as a letter from the lender declaring a default and stating that it is "retaining the collateral" (i.e. the stock and proprietary lease) in satisfaction of your debt. More commonly, the apt. is offered at auction with a notice of sale to you. If either scenario has been completed, you no longer have any interest in the coop apt. It is not uncommon for a lender to either sell the apt. to an occupant or, more rarely, agree to accept rent. If you wish to discuss this further, my number is 516-780-0270.

Re: foreclosure - tenant rights

Ralph:

If the facts are what you state, Citibank had not right to deal with your tenant. A co-op foreclosure (also known as a UCC foreclosure) is not a judicial process like real estate. Although due process and notice must be given, the process can take as little as 2-3 months. You should have been given notice of the impending sale. It should have been advertised. It is possible that the tenant was the successful bidder at the auction. Any proceeds collected in excess of the principal, interest and legal fees belong to the debtor.