Former Owner Staying in Property After Foreclosure Sale

I bought a property at a trustee sale, and the former owner refuses to get out!

Many real estate investors are taking advantage of great deals in the housing market when a property is being sold at a trustee sale. Unfortunately, some of these investors are unknowingly buying more than just a house at a great price; they might be buying a lawsuit.

What happens when the former owner refuses to vacate the property after you purchase it at a foreclosure or trustee sale? In California, you are not allowed to do any “self-help”, meaning, you’re not allowed to do something like change the locks, cut off the power, or cut off the electricity to the property to force somebody out of the house.

You must take appropriate legal action to remove a former owner or tenant from the premises.

1. Provide the proper written notice for the person to vacate the premises. If it’s the former owner, a three day notice is appropriate. If it’s a tenant of the former owner, you must determine whether they stay in the property on a month-to-month basis or if they have a lease.

2. If the tenant refuses to vacate after the notice period is up, you must file an unlawful detainer action in the superior court of the county your property is located in. There are strict technical rules to follow when filing and serving the lawsuit. You must ensure you follow the appropriate service and notice periods in order to succeed.

3. The unlawful detainer action is an expedited proceeding. This means the defendant will have approximately five days to respond to your complaint. If they don’t, you can request a default judgment taken against them in order to remove them from the property. If they do answer, you should request a trial date and work on gathering evidence for the trial by requesting documents and sending discovery requests for anything you need to prove as part of your case.

4. The tenant is not allowed to file a cross-complaint, but they may say you have done something badly as an affirmative defense. If the tenant says there was a problem with the foreclosure itself, that is a case against the foreclosing lender, not you. Unfortunately, it is up to you to show this to the judge. If the tenant has filed for bankruptcy, that will generally just delay things, but not stop the eviction itself. If your unlawful detainer action is against the former owner, they do not have a legal right to remain in the property.

5. After you prove your case at trial, the tenant will have a number of days to vacate the property. If they still refuse to do so, you may now have the sheriff assist you based on the information in the “judgment for possession” that you should have received at your trial.

The good news about unlawful detainer actions is that they are very quick. From start to finish, it generally will take about 30 days for a standard unlawful detainer action. A regular civil action, like a quiet title action or an action for ejectment can take up to a year or more.

If you have any questions about this or other matters pertaining to real estate law, please contact Silicon Valley attorney Elena Rivkin Franz at (408) 940-5360 or elena@franzlawfirm.com.