On a 55 to 41 vote, the House passed HB 1081 which imposes certain obligations on a plaintiff seeking to foreclose on property with tenants and providing certain protections for those tenants.
If a plaintiff is seeking to foreclose upon a property and files a complaint “under IC 32-30-10-5” (never mind that it’s not at all clear that a complaint can be filed under the referenced section), and if the property is occupied by not more than four rental units, the plaintiff is obligated to provide certain notices to tenants of those units within 10 days of filing the complaint. The notice must advise the tenants of the name and telephone number for communications with the plaintiff seeking foreclosure and that the tenant has the right to intervene and ask the court to oversee rental payments made for use of the property. If the notice isn’t provided to a tenant, the tenant can’t be evicted until 90 days from when the tenant actually is given notice except for cases where the tenant fails to pay rent or otherwise fails to comply with the rental agreement.
After the foreclosure judgment, the plaintiff “seeking foreclosure” (would the plaintiff be “seeking foreclosure” any longer if a judgment has been entered?) has to give tenants 60 days notice of the foreclosure judgment before evicting them (except for failing to pay rent, etc.)
If someone is evicted without the specified notices, they can bring suit for actual damages; reasonable attorney’s fees and court costs; and reasonable relocation expenses.
I don’t think I like this one. Seems like a substantial administrative burden without a huge benefit, unless creditors foreclosing on property are routinely in the habit of ejecting paying tenants who are caught unaware of the foreclosure proceedings.