Real Estate:Washington State/Tenant deposits vs Foreclosure

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Question
Re: Tenant rents and deposit handling after Foreclosure

Hello Claire,

I am the Broker at BCI Properties, LLC in Tacoma. We sell homes, but Property Management is our primary business. I am also rated 10 here on AllExperts.com ...but now I have a question.

After legal consultation we are still at a loss as to how to handle a Tenant Security/cleaning Deposit when a property owner is foreclosed on.

Case in point is a property where the tenant paid November 1st rent on time ….with all parties knowing the property was under foreclosure, and was later Notified it sold on Nov. 4th during which time he continued to live at the property after the fact. He is demanding both rent and “double the deposit” in full to be returned.

Our stand has been to hold both rent and deposit back from the prior owner who lost the property, keeping these monies in a tenant trust account until we can determine who should receive the funds held in trust. Our Attorney was not sure. Tenant is now demanding twice his deposit back and rent…, but continues to live on site.

Our thought was that the new owner who just purchased the property will most likely have some right to say if he will assume the responsibility of Landlord and hold the deposit until the tenant vacates, or to let the tenant out of the lease and give deposit back. There is also the question of damages to the property and liability which the tenant wishes to escape from. We are now being sued in small claims for $3,225.00

Can you help me with a law code or specific direction to go with this matter…, or direct me to someone who can?

Your assistance is very much appreciated.

Happy Thanksgiving!
Regards,
Donald J. Leske II
Broker / Property Manager

Answer
Hello Don,
Thanks for your question. Since property management is not my specialty, I would like to refer you to two great resources who can help.

One is www.walawhelp.org
They have a section on foreclosure/evictions, a question and answer section that might offer some help in the matter.

Also, the HOTLINE for members of of the Washington Association of REALTORS.
No additional charges for individual members calling the hotline.

Hotline number is 1-800-562-6027 or copy and paste your question to: legalhotline@warealtor.com

I am confident they can help!

Best Regards,
Claire

Real Estate:Washington State

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