My landlord defaulted on her payments for the mortgage, but did not deposit our rent?

Question

After the bank left us nice little notices informing of us this, a new owner bought the place. As soon as the property was sold then our landlord deposited our rent checks for the past 2 months. Is our money going straight into her pockets now? And is this even legal??? I still owe her for a months rent, do I have to pay since its NOT going to the mortgage payments?

Answer 1

Unfair as it is, the mortgage and lease have nothing to do with each other.  She can't evict you if you don't pay, but could take you to small claims court.

Answer 2

It is not only legal, it was ILLEGAL of you to withhold rent.   She can sue to recover it.

There are no laws dictating what landlords do with their money.

Answer 3

Whether or not the landlord defaulted, the rental contract was between you and her as the deed holder. As soon as the property was sold, or foreclosed on, she no longer was your landlord.

Therefore, you owe her rent for any period up to the time the property was sold, or foreclosed.

It is irrelevant if she paid the mortgage or not.

You may wish to inform the bank that held the mortgage that checks were not deposited until after ownership changed hands, and they may wish to she if she committed fraud in any legal proceedings, however it is of no interest to you.

By the way, make sure that the new owner honors the old lease, and has the lease rewritten in his name. Do not pay any rents without a lease from him/her.