A Summary of HB 2733

• Foreclosures
• Payment Receipts, Evidence of Payment
• Prohibition of Negative Credit Records Absent Judgment
• Acceptance of Rent Vacates a Judgment

HB 2733 is being considered at the Arizona House of Representatives. At present, it is before the Finance & Insurance Committee.

Foreclosures

Notice

· Landlords must advise their tenants of possible foreclosure within 30 days from receiving notice. This must include contact information of the owner and mortgage lender.

· Landlords must advise their tenants 60 or more days before rental properties undergo foreclosure auction.

· Within ten days after foreclosure of a trust deed, recording of a notice of sale, or filing of a summons & complaint for mortgage foreclosure, a tenant must be provided instructions about paying rent into an escrow account or to the lender’s attorney.

· A trustee shall deliver a copy of the notice of sale to the tenants within 30 days of its recording.

· In a court foreclosure action, the clerk shall notify the tenants within 30 days of the filing of the summons & complaint.

· In a court foreclosure action, the clerk shall notify the tenants of the property’s sale within 30 days after recording of the notice of sale.

Occupancy

· A tenant may continue to occupy the premises for 60 days after receiving notice from the trustee or court clerk.

· By paying a $1,000 good faith down payment to purchase the property, as well as ongoing rent to an escrow account or the lender’s attorney, the tenant may remain in the property until the auction.

Monies

· A landlord who fails to advise his tenants of an impending foreclosure must, upon demand from the tenant, return deposits, fees, prepaid rent, options fees, down payments and closing costs.

· When the property reverts to the lender, the landlord must, upon demand from the tenant, return deposits, fees, prepaid rent, options fees, down payments and closing costs.

· Wrongful withholding of these amounts shall subject the landlord to double damages due the tenant, plus attorney’s fees.

· A landlord must apply rent monies to the mortgage. If he doesn’t, in any action the tenant files to recover the wrongfully withheld amounts, above, the rent must also be returned.

· Net amounts due from the landlord to the tenant shall be non-dischargeable in bankruptcy.

· A tenant, or group of tenants in a multi-unit community, may purchase the foreclosed property at a trustee’s sale for the mortgage balance due.

· A tenant who remains in the foreclosed property shall pay ongoing rent to an escrow account or to the lender’s attorney, as instructed.

· A tenant who remains in the foreclosed property may extend the occupancy until the auction date by paying a $1,000 down payment to purchase the property at the auction. Should the tenant’s bid be unsuccessful, the down payment shall be returned and the tenant must vacate.

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Payment Receipts, Evidence of Payment

Rent receipt

· A landlord must provide a contemporaneous, detailed receipt for each payment tendered by the tenant.

· If hand-delivered, contemporaneous means immediate. If left in a drop-slot or similar facility, it means the next business day. If mailed to the landlord, it means the next business day after the landlord’s receipt of the payment.

· Failure to comply is a material noncompliance, and if willful and not in good faith the landlord shall be subjected to damages of two months’ rent due to the tenant.

Payment Evidence in Court

· In a nonpayment eviction case, a landlord who is shown to have refused timely tendered rent waives his right to defend his claim, and also waives his claim for rent for the disputed period.

· In a nonpayment eviction case, a copy of a timely dated money order or certified funds payable from the tenant to the landlord shall be presumed evidence that payment was tendered, until evidence is presented otherwise.

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Prohibition of Negative Credit Records Absent Judgment

· Any negative credit record placed by a landlord against a tenant is predicated upon the landlord first obtaining a court judgment.

· The negative credit record may be only for the judgment amount.

· Violation of this shall prohibit a landlord from pursuing his claim against the tenant in any forum.

· Violation of this shall be construed as defamation of credit.

· This also applies to successor parties to whom the landlord’s interest has been assigned.

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Acceptance of Rent Vacates a Judgment

· After an eviction case favorable to the landlord, if the landlord accepts another rent payment from the tenant, it shall constitute a partial payment, and vacates the judgment.

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Contact your State Legislator HERE to prevent:

• Foreclosure Abuse
• Rent Refusals
• No Rent Receipts
• Credit Report Defamation
• Eviction after Rent Acceptance

• Please CONTACT ATA with any suggested site updates, additions or corrections to this website.

© 2003-2008 by Kenneth A. Volk. All rights reserved.

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