Renters rights during a foreclosure....

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I'm looking for advice for my sister.... 6 months ago She and her boyfriend moved into a house. Our area had thousands of homes build in the last 5 years SPECIFICIALLY to rent out/ make a profit on. Many people we knew were living in homes and suddenly found out the home they rented was being foreclosed upon and they needed to move.
My sister was worried about that and asked the soon-to-be-landlord if the home was in foreclosure and he said no. As far as I know she didn't get it in writing, didn't have proof from a bank, and foreclosure wasn't mentioned in the lease.
FF to today, she received paperwork in the mail saying the bank was foreclosing against landlord at her address.....
Landlord tells her that his lawyer advised him to continue to collect rent from my sister, but he 'morally' can not do that.... But she didn't have to pay rent anymore, and she should just let him know when they planned to move out.....

He apparently wasn't morally opposed to moving in a 5 month pregnant woman and her boyfriend under the pretenses that if all goes well after the year, they could renew the lease. (Sister expressed a desire to rent a home for years/ wanted some stability)

The way he spoke to her, he made it sound like he was doing her a favor !!!!

Anyway, I just looked up some info online, and from what I am understanding under the "Protecting Tenants at Foreclosure Act of 2009" she is allowed to live there until the end of her lease, and is not obligated to pay the landlord any more rent because the bank is now the owner......
I plan to talk to her in the morning, but I was hoping to get some perception of my interpretation of that law.... Was I close, or way off???

[dinan6]

I think that if the bank is forclosing and there are tenants they have to offer the tenants money to move out of the house. At least that is how it is in california. This happened with my sister...

[JTA Mom]

This just happened to my mom, in California.

She stayed in the house rent free until April (forclosure started June). It was a bit different, since the owner decided to try to short-sell first. Once foreclosure is complete (happened in February), the bank auctioned the place off. According to the lawyer my mom spoke to, had the house short-saled, she'd have until June-ish to move out, since it takes a while for a short-sale to be complete. During auction, though, if someone bought it, she would have to talk to them, but she has up to 90 days to move. Thing is, the new owner can set the 'rent' for that time period, which might be pretty high.

If the new buyer wants to flip it, they generally offer a cash amount for moving out within a certain time period. Still not fun, but my mom had a month to move, and got paid to vacate. So not totally horrible.

Sorry your sister is going through this. It's stressful not knowing when a move has to happen, especially when she expected to be there for a while.

Ami