What Rights Do Tenants Have If the Property They’re Renting Goes Into Foreclosure?

Renters and tenants generally have fewer rights and more uncertainty than property owners. This doesn’t mean they don’t have rights or that they can be evicted without cause.



Tenants in Texas properties have rights to protect their home and their right to live peacefully. This includes if and when the property they’re renting is foreclosed upon. Even in the case of a foreclosure, tenants won’t be immediately kicked out onto the street.

Non-Judicial Foreclosure

Non-judicial foreclosures are the most common type of foreclosure in Texas. An individual or organization that has a lien against a property, such as a taxing authority, can sell the property without a court order. With non-judicial foreclosures, tenants are generally not notified of the impending sale.

Judicial Foreclosure

An uncommon type of foreclosure is a judicial foreclosure. When opting for this path, the individual or organization that has a lien against the property, such as a bank, files a civil lawsuit against the homeowner. Before selling the property, they must obtain a court order.

If the property has a tenant, the tenant should be listed as a party to the lawsuit and will be served. They will be updated throughout the case.

After the Sale

Once the rental property is sold, what happens next depends on the type of lease a tenant has. Tenants must be “bona fide,” meaning they’re legally residing in the property, to receive the following protections.

The new owner could choose to allow the tenant to remain. If they do not, they must follow certain guidelines. Tenants on month-to-month leases must be given at least 90 days’ notice if the new owner wants them to move out.

Tenants with a lease, such as a one-year lease, can remain in the property until their lease expires. The exception is if the new owner plans to move into the property. In this situation, the new owner must give the tenant at least 90 days’ notice.

Hire a Skilled Lawyer Who Knows Texas

If you have questions about landlord and tenant rights or foreclosures, the attorneys at Manfred Law can help. Call us at 713-547-5460 or contact us online to schedule your consultation.