FDIC Memo to Banks: Tenants Stay Till End of Lease term

Protecting Tenants at Foreclosure Act
Public Law
September 28, 2009
Summary: On May 20, 2009, President Obama signed the Helping Families Save Their Homes Act of 2009, Public Law 111-22. Included in the public law is the Protecting Tenants at Foreclosure Act (Division A, Title VII), which provides protections for tenants, including tenants in housing subsidized by Section 8 of the United States Housing Act of 1937, who are living in homes subject to foreclosure.


Highlights:Under the Protecting Tenants at Foreclosure Act:

  • All tenants must receive a 90-day notice before being evicted as the result of a foreclosure.
  • With some exceptions, the law requires that in the event of foreclosure, existing leases for renters are honored to the end of the term of their lease.
  • The stated exceptions are for tenants without a lease, tenants with a lease terminable at will under state law, or where the owner acquiring the property will occupy it as a primary residence. In these cases, the tenants must receive a minimum of 90 days notice to vacate the property.
  • This law does not affect the requirements of any state or local law that provides longer time periods or other additional protections for tenants.
  • The new law does not require any agency to issue implementing regulations; these protections apply to foreclosures after May 20, 2009.
  • FDIC examiners will monitor and enforce compliance with the requirements of this law in the same manner as other consumer protection laws and regulations.

FDIC-Supervised Institutions

Suggested Routing:
Compliance Officer
Chief Lending Officer
Loan Servicing/Loss Mitigation Department

Related Topics:
Section 8(o)(7) of the United States Housing Act of 1937

Protecting Tenants at Foreclosure Act (Public Law 111-22, Division A, Title VII) – PDF (PDF Help)

Samuel Frumkin, Senior Policy Analyst, at (202) 898-6602 or sfrumkin@fdic.gov; or
Jeanne Rentezelas, Counsel, at (202) 898-6786 or jrentezelas@fdic.gov

Printable Format:
FIL-56-2009 – PDF (PDF Help)

FDIC Financial Institution Letters (FILs) may be accessed from the FDIC’s Web site at www.fdic.gov/news/news/financial/2009/index.html

To receive FILs electronically, visit http://www.fdic.gov/about/subscriptions/fil.html.

Paper copies of FDIC financial institution letters may be obtained via the FDIC’s Public Information Center (1-877-275-3342 or 703-562-2200). .

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