[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5963 Introduced in House (IH)]
110th CONGRESS
2d Session
H. R. 5963
To protect the interests of bona fide tenants in the case of any
foreclosure on any dwelling or residential real property, and for other
purposes.
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IN THE HOUSE OF REPRESENTATIVES
May 5, 2008
Mr. Ellison (for himself, Mrs. McCarthy of New York, and Mr. Capuano)
introduced the following bill; which was referred to the Committee on
Financial Services
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A BILL
To protect the interests of bona fide tenants in the case of any
foreclosure on any dwelling or residential real property, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Protecting Tenants at Foreclosure
Act of 2008''.
SEC. 2. EFFECT OF FORECLOSURE ON PREEXISTING TENANCY.
(a) In General.--In the case of any foreclosure on any dwelling or
residential real property after the date of enactment of this Act, any
immediate successor in interest in such property pursuant to the
foreclosure shall assume such interest subject to--
(1) the provision, by such successor in interest of a
notice to vacate to any bona fide tenant at least 90 days
before the effective date of such notice; and
(2) the rights of any bona fide tenant, as of the date of
such notice of foreclosure--
(A) under any bona fide lease entered into before
the notice of foreclosure to occupy the premises until
the end of the remaining term of the lease, except that
a successor in interest may terminate a lease effective
on the date of sale of the unit to a purchaser who will
occupy the unit as a primary residence, subject to the
receipt by the tenant of the 90 day notice under
paragraph (1); or
(B) without a lease or with a lease terminable at
will under State law, subject to the receipt by the
tenant of the 90 day notice under subsection (1),
except that nothing under this section shall affect the
requirements for termination of any Federal- or State-
subsidized tenancy or of any State or local law that provides
longer time periods or other additional protections for
tenants.
(b) Bona Fide Lease or Tenancy.--For purposes of this section, a
lease or tenancy shall be considered bona fide only if--
(1) the mortgagor under the contract is not the tenant;
(2) the lease or tenancy was the result of an arms-length
transaction; or
(3) the lease or tenancy requires the receipt of rent that
is not substantially less than fair market rent for the
property.
SEC. 3. EFFECT OF FORECLOSURE ON SECTION 8 TENANCIES.
Section 8(o)(7) of the United States Housing Act of 1937 is
amended--
(1) by inserting before the semi-colon in subparagraph (C)
the following: ``and in the case of an owner who is an
immediate successor in interest pursuant to foreclosure--
``(i) during the initial term of the lease
vacating the property prior to sale shall not
constitute other good cause; and
``(ii) in subsequent lease terms, vacating
the property prior to sale may constitute good
cause if the property is unmarketable while
occupied, or if such owner will occupy the unit
as a primary residence''; and
(2) by inserting at the end of subparagraph (F) the
following: ``In the case of any foreclosure on any residential
real property in which a recipient of assistance under this
subsection resides, the immediate successor in interest in such
property pursuant to the foreclosure shall assume such interest
subject to the lease between the prior owner and the tenant and
to the housing assistance payments contract between the prior
owner and the public housing agency for the occupied unit,
except that this provision and the provisions related to
foreclosure in subparagraph (C) shall not shall not affect any
State or local law that provides longer time periods or other
additional protections for tenants.''.
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