If I am renting a house from a friend who decided to do a short sale on the house and is no longer paying the mortgage am I still resposible for the rent which was to cover the mortgage? Is she able to cash in on a house she is not paying for and essentially decided to sell before the lease term was up
Answer
You are obligated to pay rent under your lease, however if you gave her a security deposit I would ask her to show you a bank statement showing the funds are still there.
If you are on a month to month lease the buyer or your friend will have to terminate the lease and you are entitled to your security deposit back less any damages beyond normal wear and tear.
If you have a lease for a term of months, you have to agree to vacate the premises voluntarily unless there is a termination provision.
However, her wanting to sell the home is not grounds for not paying the lease. Even in foreclosure,unless contacted by the lender and told to pay them the rent, you should continue to pay rent. However, make sure any security deposit or payment of last months rent is in a separate escrow account.
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