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Mortgagee ending a tenancy

There are two ways the property you're renting can be repossessed: 

  • by the mortgagee (i.e. a bank or other lender), which is the most common; or, 
  • by a person with superior title (e.g. Government authority). 

The mortgagee or person with superior title must apply to the Supreme Court to ask for possession of the rental property. During that process there are two notices that you may receive.

Notice of application to repossess 

When you would receive it

Normally as part of the repossession application process the mortgagee will provide you with a Notice to Tenant of Proposed Recovery of premises by Person with Superior Title (Form 17). The Supreme Court usually requires the mortgagee to provide this form to tenants, although this doesn’t always happen. 

What it means

Form 17 advises you that the mortgagee has applied to the Court for possession of the property. You may also hear about the circumstances from the landlord or property manager without receiving the form. 

How it affects you

Though the property is under application for repossession, there is NO change in your tenancy agreement and NO requirement for you to move out. You and your landlord/property manager should continue to honour the tenancy agreement. You may wish to contact your landlord/property manager to discuss the situation as it can take a long time for the Supreme Court to order the repossession.

What you can do

If you want or need to stay long-term, you could apply to the Court asking for an order to continue to rent the property from the new owner. This would be subject to conditions determined by the Court and would take effect when the mortgagee takes possession of the property. 

If you’d like to end the tenancy before the new owner takes possession, you’ll need to give 21 days’ notice for a periodic tenancy or negotiate with the current owner to end by mutual agreement for a fixed-term tenancy. If you break a fixed-term agreement without first obtaining written agreement from the landlord you’ll be liable for rent and other costs until the agreement is terminated.

Notice to vacate

When you would receive it

When a mortgagee takes possession of the property and they want you to vacate, they must give you at least 30 days’ notice via a Notice to vacate from Mortgagee to Tenant (Form 14)

What it means

This form notifies you of the change in property ownership, the termination of your tenancy agreement and the date by which you must have moved out. To be valid, the notice must be properly completed including your name and that of any other tenants on the agreement.

How it affects you

There is no need to rush to vacate. 

For the first 30 days from the date that you receive the notice, you do not pay rent to stay in the property. If you paid rent in advance for any portion of this period, you are entitled to repayment and should contact the representative indicated on the notice form to make arrangements for any refund.

The mortgagee (or representative) may show the premises to prospective purchasers, but only if you are given reasonable notice and agree to the date and time of the showing.

What you can do

If you want to stay you might be able to negotiate a new rental agreement with the mortgagee. This would come into effect after the first 30 days (rent-free) period has passed. Contact the representative indicated on the notice form to enquire.

You could also apply to the Magistrates Court asking for an order to extend your rental agreement, subject to conditions determined by the Court. If you want to go to court, contact Tenancy WA for more information and advice.

For more information and to clarify your options if you've received either of these notifications, you can call Consumer Protection on 1300 304 054.

 

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