The California Code of Civil Procedure, Chapter 4, Section 1161b allows the new owner of a foreclosed rental property to terminate a preexisting tenancy by fulfilling the following notice requirements:
Month-to-Month Lease or Periodic Tenancy
A tenant or subtenant in possession of a rental housing unit under a month-to-month lease or periodic tenancy at the time the property is sold in foreclosure shall be given 90 days’ written notice to quit pursuant before the tenant or subtenant may be removed from the property as prescribed in this chapter.
Fixed-Term Lease
Tenants or subtenants holding possession of a rental housing unit under a fixed-term residential lease entered into before transfer of title at the foreclosure sale shall have the right to possession until the end of the lease term, and all rights and obligations under the lease shall survive foreclosure, except that the tenancy may be terminated upon 90 days’ written notice to quit pursuant to subdivision (a) if any of the following conditions apply:
- The purchaser or successor in interest will occupy the housing unit as a primary residence.
- The lessee is the mortgagor or the child, spouse, or parent of the mortgagor.
- The lease was not the result of an arms’ length transaction.
- The lease requires the receipt of rent that is substantially less than fair market rent for the property, except when rent is reduced or subsidized due to a federal, state, or local subsidy or law.
Note: The purchaser or successor in interest shall bear the burden of proof in establishing that a fixed-term residential lease is not entitled to protection under this section.
Amended by Stats. 2012, Ch. 562, Sec. 3. (AB 2610) Effective January 1, 2013. Repealed as of December 31, 2019, by its own provisions.
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