Let’s say you buy a house at a foreclosure auction and that house still has tenants in it. Let’s also figure you don’t want to rent to them, but would like to move into the property. What kind of notice do you need?

President Obama passed a law (which will expire in 2012) which requires 90 days notice before one can begin unlawful detainer proceedings. The question often asked is whether the tenant is required to pay rent, and if a tenant can be evicted if they do not pay rent.

Although it seems obvious that the idea of the 90 day notice rule promulgated by Obama wasn’t to give 90 days free rent to deadbeat tenants, it appears that California courts are interpreting it exactly this way. If the tenancy is month-to-month, then normally 60 days are required for an eviction which is NOT based upon non-payment of rent.

Although the “lease” between the new landlord and the tenant still exists (the new landlord “steps into the shoes” of the old one) California courts often believe (in my opinion erroneously) that the tenant need not pay rent for the 90 day period.

If the purpose of the 90 day period is to provide stability for tenants who occupy properties the subject of a foreclosure, then it is a understandable position for the court to take. The idea that the tenant who previously was paying rent, now need not pay rent because the house went through foreclosure, simply doesn’t pass the smell test.

That being said, the safest and best practice is to simply give the 90 day notice, rather than relying upon the court to think upon the legislative intent of the law.  It’s a gray area that might not go well for you.