Tenant Eviction Due to Foreclosure in Texas

The Texas Property Code Chapter 92 spells out the Texas landlord and tenant laws. According to Chapter 92, landlords who purchase property through foreclosure are required to allow their tenants to terminate their leases without providing additional notice to their new landlords. Prior to the enactment of the Protecting Tenants at Foreclosure Act of 2009, Texas landlords could terminate their leases with their tenants without providing more than 30 days of advance notice.

Protecting Tenants at Foreclosure Act

    The Protecting Tenants at Foreclosure Act allows tenants to remain in their homes without worrying about imminent evictions. The act expires on Dec. 31, 2012. To help tenants guard themselves against forceful and unexpected evictions, the act helps tenants caught between their landlords' failure to pay their mortgages and pending bank foreclosures. All tenants have at least 90 days to locate new rental units if their landlords face foreclosure. After a bank foreclosure, a landlord must provide at least a 90-day written notice of foreclosure and an opportunity to move. Tenants with written leases can finish out their lease terms as long as they continue paying rent.

Notice Requirements

    At a minimum, tenants have 90 days to look for new housing, and their landlords cannot evict them as long as they pay rent. Tenants are required to pay the same amount of rent to their new landlords as they paid to their previous landlords. Private tenants and public housing tenants have the same rights to notice under the Protecting Tenants at Foreclosure Act. Banks or new landlords must notify tenants of where they should send their rental payments after foreclosure, and if they fail to do so, then tenants can continue paying rent to their previous landlords who must surrender their rent payments to their new landlords.

Limitations

    The Protecting Tenants at Foreclosure Act does not require new landlords to provide tenants with 90 days to look for new housing before evicting them if they intent to occupy the property. In other words, if an owner purchases a foreclosure rental and begins living in it as his new home, his tenant must find housing immediately. Texas law does not require legal court action before banks can foreclose upon landlords.

21-Day Notice

    Banks are only required to provide a 21-day written notice to landlords facing foreclosure. Landlords have 21 days to pay their delinquent mortgages, and if they fail to cure their delinquencies, banks can sell their homes at foreclosure auctions on the first Tuesday of the following month after they send their notices.

Security Deposits

    Under Texas law, new landlords are not required to return tenants' security deposits. Instead, previous owners are required to return their security deposits. If they fail to return them within 30 days, Texas law allows tenants to sue for damages for withholding their security deposits.



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