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Sublease renter where house went into foreclosure, roommate gave my security deposit to ex-landlord, what do I do?
Anonymous2 views4 answers
I sublease from my roommate. I gave him a $250 security deposit by money order. He then apparently paid it to the landlord. I asked my roommate if he had proof of this transaction and he said he needs to look at his records. I'm not sure of the whole legal process that's going to happen now, but I have a few questions. It's a month to month lease normally so do we need to pay the rent to anyone now or what generally happens with that? And since my roommate is the lease holder and responsible for what happened to my security deposit, if he doesn't have proof, am I within my legal rights to withhold $250 from my next rent payment to him? I asked for an account information of it months ago and never received it. I have proof in a security deposit money order and signed receipt from roommate.+
You have an ongoing obligation to pay rent until the property is formally foreclosed against by the lender. So far as the security deposit goes, your lessor is supposed to place it into an escrow account until a withdrawal must be made therefrom. It is your right to demand an accounting of the security deposit funds.
Good luck with your case!
In many states, tenants in a foreclosed property have protected status. You need to pay everything going forward by check. You need to retain an attorney. If you can't afford an attorney you need to contact legal services and the local law school legal clinics. Good luck.
Michael Christopher BurrChapter 13 Bankruptcy AttorneyChicago, IL ·
You still have to legally pay the rent, but frequently people going through foreclosure don't insist on all their legal rights. The key is to find out if the landlord is going to save the property. They could do a loan modification or bankruptcy to help get out of foreclosure, and then you would owe all the rent that came due. But, if they are giving up the building, they are not paying the mortgage now so maybe he would agree that you don't have to pay the rent.
Your roommate must account for the security and should have put it in an escrow account at a bank. You can offset this from your rent and even sure him in small claims court but since that will make living together miserable you may want to try to just work this out. The amount of money involved is relatively low compared to the aggravation you may get from court.
