My Home Has Been Foreclosed -- Now What?
Authored By: Real Estate, Housing and Land Use Section
I have been notified that my home was sold at a foreclosure auction and that the purchaser wants to evict me. What can I do?
If you remain in your home after it has been sold at a foreclosure sale you become a tenant of the purchaser. However, that tenancy can be terminated by the new owner by serving a 30-day Notice to Quit upon the former owner remaining in possession of the property. Once the new owner has done this, she can seek your eviction by filing a Complaint in Landlord & Tenant Court.
What if I never received any Notice to Quit?
Proper service of a sufficient Notice to Quit is required before a foreclosure purchaser may sue for possession, so you can come to court on the date set in the Summons and tell the judge that you never received notice. If the purchaser disputes this, the judge will set a hearing to consider this defense.
What if I think that the foreclosure sale was not legal?
You are entitled to claim that the purchaser at the foreclosure sale is not really the owner of the property because the sale did not comply with the legal requirements for such sales. This is called a "Plea of Title."
How do I make a Plea of Title?
A Plea of Title must be submitted to the Clerk in a written document signed in front of a Notary Public or Deputy Clerk. At the same time, you must also file an "Application to Determine Undertaking."
What do I have to say in these documents?
The Plea of Title lists the reasons why you believe the foreclosure sale was not valid. These might include problems with the notice of the sale, or the sale procedure, or any other reason why you believe that the sale was invalid. The Application to Determine Undertaking requests the Court to determine what, if any, payment you have to make into the Court to remain in the property while your case is being decided.
What might I have to pay?
The purpose of the "undertaking" is to give the new owner security for appropriate compensation for your use of the property during the litigation if it is determined that the foreclosure sale is/was valid. The judge can require that you post a bond, or make monthly payments, or both. The judge has wide discretion in determining what to require.
What if I cannot pay what the judge orders?
If you cannot pay what the judge orders on time, you can file a written Motion requesting an extension of time to pay. If that request is denied, or if you still cannot pay, your "Plea of Title" will be stricken, and a judgment for your eviction can be entered against you unless you have some other defense, such as the failure to serve a proper 30-day Notice to Quit.If you are evicted from the property because you did not comply with the requirements of the undertaking, you have not lost the right to have the Court determine whether there was a legally valid foreclosure sale of your property. However, you would have to make that claim in a separate law suit YOU file in the Civil Division of the Superior Court. Filing that suit will probably not stop your eviction. However, if you file and win that lawsuit, you will regain the title to the property, and you will be entitled to regain possession of it. You should probably consult a lawyer to help you with this process.
What if property which I occupy as a tenant has been sold to a new owner at a foreclosure sale?
In this situation, you become the tenant of the new owner and the terms of the tenancy you established with the previous owner are still in effect. However, the change of ownership may affect the applicability of rent control to the property.