Utah Code Title 78B. Judicial Code § 78B-6-802.7. Foreclosure of residential rental property--Effect on tenancy

(1) As used in this section:

(a) “Bona fide residential rental agreement” means an agreement, for a property secured by a mortgage:

(i) that was the result of an arm's-length transaction;

(ii) established before the filing of an action to foreclose the mortgage under Part 9, Mortgage Foreclosure;

(iii) that provides an individual the right to exclusive use and occupancy of the residential property:

(A) on an at-will basis;  or

(B) for a period specified by the agreement that is no longer than twelve months;  and

(iv) that requires the individual to pay rent in an amount that:

(A) is not substantially less than fair market rent for the property;  or

(B) is less than fair market rent due to a federal, state, or local subsidy.

(b) “Bona fide tenant” means an individual who:

(i) has the right to occupy a residential property under a bona fide residential rental agreement;

(ii) is not the mortgagor;  and

(iii) is not the mortgagor's child, spouse, or parent.

(c) “Foreclosed rental property” means a property that:

(i) is the subject of a bona fide residential rental agreement;  and

(ii) is foreclosed under Part 9, Mortgage Foreclosure.

(d) “New owner” means the immediate successor in interest of a foreclosed rental property following foreclosure of the property.

(2)(a) Except as provided in Subsection (2)(b), a new owner assumes ownership of a foreclosed rental property subject to a bona fide tenant's right to occupy the foreclosed rental property:

(i) according to the terms of a bona fide residential rental agreement;  and

(ii) until the end of the term of the bona fide residential rental agreement.

(b) Subject to Subsection (3), a new owner who intends to occupy a foreclosed rental property as the new owner's primary residence may terminate:

(i) the bona fide residential rental agreement;  and

(ii) the bona fide tenant's occupancy of the foreclosed rental property.

(3)(a) A new owner who terminates a bona fide tenant's occupancy of a foreclosed rental property shall serve, to the bona fide tenant, a notice to vacate:

(i) at least 45 days before the day on which the new owner requires the bona fide tenant to vacate the foreclosed rental property;  and

(ii) as provided in Section 78B-6-805 .

(b) A notice to vacate under Subsection (3)(a) shall:

(i) be in at least 14-point font;

(ii) state the new owner's name, address, and contact information;

(iii) explain the reason the new owner requires the bona fide tenant to vacate the rental property;

(iv) state the date on which the bona fide tenant is required to vacate the rental property;  and

(v) refer to this section as the law under which the notice to vacate is provided.

(4) This section does not modify the requirements for termination of a federally subsidized tenancy.


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