As the collapse of the housing market continues, foreclosures are all too common. Many good tenants, who pay their rent on time are finding themselves having to move because their landlord has not been paying the mortgage.
Tenants are learning lessons from the housing bust. It is wise to check out the landlord before signing a lease, moving all of your stuff in and paying rent. This is not too difficult to do, the main thing the tenant needs to see is the pay history on the mortgage for the last two years. One way to accomplish this is to run a credit report on the Landlord to show payment histories on all of their mortgages. With authorization, a verification of mortgage (VOM) could be sent to the Landlord’s mortgage company. The VOM could take over a week, so it is a good idea for a landlord to go ahead and request it so that it can be provided to prospective tenants at application.
When a property goes into foreclosure, the landlord should be upfront with the tenants about the situation. The tenants could possibly sue as they are promised uninterrupted enjoyment of the property in the lease. If a foreclosure process is started, any property management contracts are voided.
For more cash flow maximizing advice contacts Relevé Property Management, no strings attached.