(a)  The mortgagee shall provide to each bona fide tenant a written notice: (1) Stating that the real estate is scheduled to be sold at foreclosure; (2) Stating the date, time, and place initially scheduled for the sale; (3) Informing of the availability and advisability of counseling and information services; (4) Providing the address and telephone number of the Rhode Island housing help center and the United Way 2-1-1 center; (5) Reminding the recipient to continue paying rent to the landlord until the foreclosure sale occurs; and (6) Stating that this notice is not an eviction notice. The notice shall be mailed by first-class mail at least one business day prior to the first publication of the notice required by § 34-27-4. A form of written notice meeting the requirements of this section shall be promulgated by the department of business regulation for use by mortgagees no later than sixty (60) days after the effective date of this section. The notice may be addressed to “Occupant” and mailed to each dwelling unit of the real estate identified in the application for the loan secured by the mortgage being foreclosed. Failure of the mortgagee to provide notice as provided herein shall not affect the validity of the foreclosure.

contract signature

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Terms Used In Rhode Island General Laws 34-27-7

  • Contract: A legal written agreement that becomes binding when signed.
  • Foreclosure: A legal process in which property that is collateral or security for a loan may be sold to help repay the loan when the loan is in default. Source: OCC
  • Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Mortgagee: The person to whom property is mortgaged and who has loaned the money.
  • Mortgagor: The person who pledges property to a creditor as collateral for a loan and who receives the money.
  • real estate: may be construed to include lands, tenements, and hereditaments and rights thereto and interests therein. See Rhode Island General Laws 43-3-10

(b)  For purposes of this section, a lease or tenancy shall be considered bona fide only if:

(1)  The mortgagor, or the child, spouse, or parent of the mortgagor, under the contract is not the tenant;

(2)  The lease or tenancy was the result of an arms-length transaction; and

(3)  The lease or tenancy requires the receipt of rent that is not substantially less than fair-market rent for the property or the unit’s rent is reduced or subsidized due to a federal, state, or local subsidy.

History of Section.
P.L. 2014, ch. 486, § 3; P.L. 2014, ch. 513, § 3; P.L. 2016, ch. 512, art. 1, § 23.