New owner/old lease

October 6, 2009 6:38 PM

Does my new landlord have to honor my old lease?

I live in an 8 unit building and I am 6 months into a year lease. About a week ago I had a note on my door saying my building is now owned by Such and Such Company and to please send my rent there.

Now tonight I come home to another note saying that the new company wants 2 things from all tenants. One is whether or not we have a garage. Fine no problem.

The other is....since the previous owner didn't give the new company any of the original paperwork (huh?) could we please kindly fill out the rental application by Friday. This includes basic stuff (name, employer, etc) but also signing off on their right to do background check, credit check, etc. It also has a thing you fill out for a rental reference that they would send to an old landlord. The letter does state that this info is 'simply for our records and files.'

I looked at my old lease. Its typical boilerplate generic lease....it does have one paragraph about 'Lease is Subject to Mortgage' and says that, for example, should the property be foreclosed on, the new owners rights are superior to the rights of the tenant.

So here are my questions:

Why am I filling out the rental application? Ostensibly its just so they have one on file. Thats fine and dandy if thats all it is....but is that really all it is?

The whole 'lease is subject to mortgage' thing. Does anyone know what that means in practice? Is the new owner likely to void my lease because i don't fit their idea of a perfect tenant?

Do new owners typically honor the remainder of old leases?

Any other advice? It seems like the company is just doing pretty standard stuff, the place is going from ma and pa ownership to McRental Corp...so it makes sense that the company wants everything on THEIR paperwork. But then why I am giving them permission to do a background check, credit check etc? I already have the apartment, I am not applying for one. I guess I am just asking, is this a red flag situation?

posted by ian1977 to law & government (15 comments total)

Without knowing where you live the best answer anyone here can give you is that you ought to consult with a lawyer familiar with your jurisdiction's laws.
posted by dfriedman at 6:40 PM on October 6

sorry....Minnesota.
posted by ian1977 at 6:42 PM on October 6

that clause in your lease is probably the out the new owner needs.

typically a lease trumps a sale of the property, but it appears that your old landlord was anticipating this...

I would suggest, if the new landlord is imposing something you don't like, that you have a real estate attorney take a look at this....
posted by HuronBob at 6:47 PM on October 6

You mention there's a clause that says if the building is foreclosed on, they can kick you out.

But it sounds like this isn't a foreclosure; it's a sale.

I'd read the boilerplate more carefully. And there's probably some local tenant organization that has people who can explain what's going on.

You say you're not a model tenant. But if you pay your rent, I see no reason why they'd try to get rid of you.
posted by madcaptenor at 6:51 PM on October 6

"You say you're not a model tenant."

I did? :-P
posted by ian1977 at 6:56 PM on October 6

I would send them a copy of the lease and that is all. It sounds like a valid lease. IANAL. (My mother wishes I were.) I was renting the guest cottage on a property while in college. I had a verbal agreement that ran the school year. (Less than one year.) New owner wanted us out so his mother in law could move in. We went to student services. THen we went to court. We won. THe only issue we had was that it was "for the school year", and we wanted to stay after exams until graduation. Judge tossed a bone to landlord and told us to leave the last day the University had exams, not on graduation. We ran up a big lawyer bill for the guy too. If he is not foreclosing, you have a valid lease especially since it is in writing. If ours was for more than a year, in Virginia, we would have lost as oral contracts for real estate were only valid for less than a year according to our free attorney.
posted by JohnnyGunn at 7:15 PM on October 6

When they bought the building they bought the lease unless your state has some odd laws here. Usually the only buyer who can break the lease is a buyer who intends to occupy the space themselves personally. Don't sign this new document if it is not better than the old one. As JohnnyGun suggested, just counter their claim that they lack the old doc with a copy.
posted by caddis at 8:04 PM on October 6

Just for grins, I'd check out and make sure it is actually legit. That sounds like a quick way to get a quick few grand and some detailed identities to abuse, simply by opening up a PO box and slipping some notes under some doors.

But yeah, I think usually the lease runs with the building. It's a contract, and I really doubt a contract that says "oh by the way, if I sell the building this contract is void" would be legal.
posted by gjc at 8:16 PM on October 6

When I first read this I thought the same thing as gjc's first inclination. Have you spoken to any management at your current place to make this that this is really happening? Seem odd they wouldn't mention it to anyone.
posted by june made him a gemini at 9:22 PM on October 6

Read the MN Attorney General's landlord/tenant handbook and then call the Minnesota Renter's helpline at
Minneapolis: 612-673-3003
Metro: [phone]
Greater MN [phone]

I am pretty sure there is section of that handbook that talks about what happens after a sale, and the helpline should be able to explain that clause to you.

Also, you can give them info without signing anything that lets them check your credit.
posted by soelo at 9:27 PM on October 6

...and by "them" I mean the new owners.
posted by soelo at 9:28 PM on October 6

Anecdotally, since I'm neither in the same jurisdiction nor state, my building has been sold twice in the 2.5 years I've been living in this complex. Each time, the original lease continued until it expired, then I signed a lease from the new owners. My lease has continued with the building complex, not with the owners.

The new rental application and background/security checks could be just normal, everyday things. However, paranoically, it could be used as a basis to not give residents the option to renew their leases when they're up. Even if you're able to get out of providing it now, they'll probably ask for it at lease renewal anyway.
posted by bookdragoness at 12:09 AM on October 7

ian: yoou wrote "Is the new owner likely to void my lease because i don't fit their idea of a perfect tenant?" I may have reworded this a little too aggressively; you didn't say you're not a model tenant, you said that they might not think you are.
posted by madcaptenor at 5:55 AM on October 7

Thanks everyone!

soelo has it....

from the MN renter's handbook....

"Sale of the Building
If the landlord sells the house or apartment (as opposed to foreclosure by a bank), the lease transfers to the new owner (buyer). (42) "
posted by ian1977 at 6:26 AM on October 7

Is the new owner likely to void my lease because i don't fit their idea of a perfect tenant?

As you've noted, your current lease should still be valid. Do note, though, that they are free not to renew your lease after the current one ends if you don't fit their idea of a perfect tenant — but that's an issue for a few months down the road.
posted by Johnny Assay at 7:12 AM on October 7