My First Foreclosure

Friday evening I called one of the tenants living in my Bowers St property to see when I could stop by to pick up rent. When he answered the phone I asked how things were going and he responded by saying "Not good". When I asked what was wrong he told me that someone came by his apartment earlier that day and gave him a notice telling him that house had been foreclosed on and that he must move out within two weeks. Keep in mind that his wife is due in one week, he has two other kids, and his parents (who are in and out of the hospital) are living with him. Plus he works his ass off to support all of them! It was understandable that he was freaked out.

After explaining to him that the law is on his side and no one can legally make him move out, I called my bank to find out what was going on. They told me they foreclosed on the property on Monday! Five days had passed and I had not received a single call! The same day my realtor received an offer to buy the property. When he called to submit the offer to the bank, they told him it was too late because the property had already been foreclosed on!

So Friday evening I visited all of the tenants on Bowers St and explained to them what had happened. I explained that the letter they were given telling them to move out was meant to scare them into leaving because it would make it easier for the bank to sell the property.

Having been a landlord for the past five years, I've learned a thing or two about tenant rights and the local laws protecting them. Unless the landlord has a really good reason to kick the tenant out, it's very difficult (if not impossible) for the tenant to be legally evicted. Even if the landlord had lots of valid reasons to kick the tenant out (for example if the tenant was doing something illegal in the property), it could still take more than six months before the tenant is forced to leave. That's just the way the laws are around here and it sucks (for the landlord).

The Bowers St property was the second investment property I purchased and probably the one that has caused me the most trouble. At the same time, it was the best property because all the tenants were excellent and paid their rent on time. The units were also the largest of all the properties with three bedrooms in each of the three units.

It's now Monday, exactly one week since it was foreclosed on, and I have yet to hear from the bank. They're probably going to stick me with the $280k that was owed on it, but I will deal with that when the time comes.

On Sunday evening, one of the Bowers St tenants was having trouble with his heating system. He called me. He was aware that I no longer owned the property but he had no one else to call. I felt somewhat obligated to help him out since he had never paid his rent late, he had helped paint the apartment, and was otherwise a great guy. Since I was in the area and didn't need to be anywhere in a hurry, I helped him out.

It definitely felt weird standing in the basement and realizing that I no longer own that house.

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