My son is a tenant in Brisbane. He is on a 12 month lease, with 11 months left to go. He only moved in a month ago and now is being told by the PM that the place will be going on the market. As I understand it, his lease must be honoured by any new owner but I am wondering if that applies to the bank. The PM suggested that the landlord needs the money rather quickly so I was wondering if he is falling behind on his mortgage and what happens if the bank moves to foreclose. Do they have to honour a fixed lease? I have a feeling they don’t.
Do banks have to honour a fixed lease?
- Thread starter alplant
- Start date
I believe a house cannot be placed on the market in the first three months of a tenancy. At least that is what I was told by people who rented a house in our street only to have it listed for sale just after.
Residential Tenancies Assoc will tell you the facts. Give them a call.
They had it happen to them the house before moving into our street, so they were rightly upset. The house before did sell, and they were given $10K to move. Clearly the vendor thought it worthwhile to pay the tenants $10K to vacate. The tenant told us that figure, why would they lie. The price for the house must have been good to offer the tenant that kind of money to vacate.
When it happened in the next house they rented (in our street) they said "no more", made it clear they would be staying for the full term of the lease and made it very difficult for the agents to show prospective purchasers through.
Good on them too. A contract needs to be respected by both parties.
Residential Tenancies Assoc will tell you the facts. Give them a call.
They had it happen to them the house before moving into our street, so they were rightly upset. The house before did sell, and they were given $10K to move. Clearly the vendor thought it worthwhile to pay the tenants $10K to vacate. The tenant told us that figure, why would they lie. The price for the house must have been good to offer the tenant that kind of money to vacate.
When it happened in the next house they rented (in our street) they said "no more", made it clear they would be staying for the full term of the lease and made it very difficult for the agents to show prospective purchasers through.
Good on them too. A contract needs to be respected by both parties.
Yeah, I kinda thought that might be the case.
Oh, well like I said to him fingers crossed for the best case scenario which would be a quick buyer who is another investor happy to have a long term tenant in place.
That's interesting about not being able to put a place on the market in the first three months of a lease. It might be worth his while to check that out. I don't like his chances at getting ten grand in compensation though, but I bet he would - like his chances that is.
He has checked with the RTA's website and apparently because the place was listed in the first two months of the beginning of the tenancy and he wasn't informed at the time of signing he has the option of ending the agreement with two weeks notice.
It also mentions that if the bank forecloses they can cancel the lease but still have to give him two months notice.
It also mentions that if the bank forecloses they can cancel the lease but still have to give him two months notice.
Ok, it gets better and better. He dug a little bit further into the RTA website and found that the two months notice only applies if the financial institution never agreed to the place being used as a rental in the first place. If they did, they can't end a fixed term lease until the end of the lease unless the tenant agrees. It's a bit different if it's periodic.
So even the banks can't just throw you out if you have a fixed term lease, well not if they agreed to finance the place as a rental anyway.
So even the banks can't just throw you out if you have a fixed term lease, well not if they agreed to finance the place as a rental anyway.
How can the bank plead ignorance? They know where you live & the mailing address isn't the property/security.
