Judge Lawrence Cho in Los Angeles has turned down a lender’s attempt to evict a nonpaying tenant after the lender bought the property in a foreclosure sale. Judge Cho found that the federal law titled Protecting Tenants at Foreclosure Act (“PTFA”), requires new owners of foreclosed properties to give existing tenants 90 days’ notice before eviction. In his ruling, Judge Cho found that the 90 day notice provision is inviolable no matter what theory of eviction a foreclosing party has available to it and that the lender cannot evict an existing tenant without providing the minimum 90 day notice to bona fide tenants under PTFA.
I have attached copies of the Daily Journal March 2012, the Protecting Tenants at Foreclosure Act of 2009, and a copy of Judge Cho’s minute order, PNMAC v Stanko Minute Order. Since eviction is an issue that frequently comes up in the bankruptcy context, I hope you find this information helpful. *PTFA is set to sunset in 12/31/12.
Magdalena Reyes Bordeaux
Senior Staff Attorney
Consumer Law Project & Debtor Assistance Project