Bought a Home and Found a Tenant Inside: What Now?

You have the keys and the mortgage payments have started, but when you open the door, someone is still living there: a tenant, a relative of the seller, or a stranger with no clear right to be there. In New York, handling this badly can drag on for months or longer.

First: Never Try to “Clear Them Out” Yourself

Changing the locks, removing belongings, shutting off utilities or forcing your way in are all unlawful evictions in New York. An occupant who has lived in the home for 30 days or more can be removed only through a court proceeding. Self-help eviction can be a misdemeanor and bring civil penalties (Real Property Actions and Proceedings Law (RPAPL) §768; NYC Administrative Code §26-521).

Second: Figure Out Who the Occupant Is

The approach depends entirely on who the occupant is:

Why Does a Lease Survive the Sale?

The general rule in New York is that a buyer takes the property subject to the rights of those in actual possession. Someone living in the home is itself notice, and the buyer is expected to find out on what basis they are there (Phelan v. Brady, 119 N.Y. 587 (1890)). So a valid existing lease does not end because the home is sold. You become the new landlord.

Security deposits must be transferred too. On a sale, the prior owner should turn tenants’ security deposits over to the new owner and notify the tenants, and the new owner then becomes responsible for them (General Obligations Law §7-105).

Recovering Possession Through the Courts: An Overview

1. Written notice.
   - A landlord who will not renew a lease or is ending a month-to-month tenancy must give advance notice: 30 days if the tenant has lived there less than one year, 60 days for one to two years, and 90 days for more than two years (Real Property Law §226-c);
   - For licensees, squatters and similar occupants, a 10-day notice to quit generally applies (RPAPL §713).
2. A holdover proceeding, brought in Housing Court in New York City or in the local court elsewhere.
3. Judgment and enforcement. After a judgment, a marshal or sheriff must serve a 14-day notice before the eviction can be carried out (RPAPL §749). In New York City, the court may also stay enforcement for up to one year in appropriate cases (RPAPL §753).

Will the Good Cause Eviction Law Affect Me?

The Good Cause Eviction Law (Real Property Law Article 6-A), effective April 20, 2024, applies automatically in New York City and elsewhere only where a locality opts in. Covered tenants have a right to renewal, and a landlord needs a legally recognized “good cause” to decline renewal or evict.

• Occupancy by the owner or a close family member is one such ground, but it cannot be used against tenants who are 65 or older or disabled;
• Small landlord exemption: landlords who own no more than 10 units in New York State (for entities, counted for each individual owner), owner-occupied buildings of no more than 10 units, and buildings with a certificate of occupancy issued in 2009 or later (for 30 years), among others, are exempt;
• Condo and co-op units are generally not covered.

Rent-stabilized apartments are even more protected. Since the 2019 reforms, an owner may recover only one unit for personal use, must show an immediate and compelling need, and older, disabled or long-term tenants have additional protections.

Squatters: What Changed in 2024

The 2024 State budget amended RPAPL §711 to state expressly that a “tenant” does not include a squatter, meaning a person who entered without permission and occupies the property without any legal right. In clear-cut intrusions, police can treat the matter as trespass. In practice, however, if the occupant produces a lease or utility bill, police often direct the owner to court.

Can I Go After the Seller?

• The contract required vacant delivery and the seller breached. If you have not closed, don’t close. Have your attorney demand that the seller resolve the problem first, or negotiate an escrow holdback from the price with a per-day charge. If you already closed, whether you can recover depends on whether that obligation survives closing under the contract;
• The seller hid the occupant or falsely claimed the home was vacant. That may be fraud;
• Title insurance usually won’t help. Standard owner’s title policies commonly except “rights of parties in possession.”

Also, if you took an owner-occupied mortgage, the loan documents usually require you to move in within a set time after closing (commonly 60 days). If you can’t, talk to your lender promptly.

How to Prevent This Before Closing

1. Write it into the contract: the home will be delivered vacant and broom clean, free of leases and occupants, with that obligation surviving closing;
2. Do a final walk-through within 24 hours of closing and confirm in person that the home is empty;
3. If someone is still there at closing, don’t close, or require a sufficient escrow;
4. If you intend to buy an occupied home (such as a two-family or multi-family), before signing ask for all leases, a rent roll, deposit records and tenant estoppel certificates, check whether any unit is rent-stabilized, and assess whether the Good Cause Eviction Law applies.

Attorney’s Insight

The core issue is this: before closing, you have leverage; after closing, you have only litigation. Our advice:

• The final walk-through is not a formality. Many of these problems arise because the buyer did not go in person and relied on a broker’s word that “they already moved out”;
• If you buy an occupied home, price in the time. If you plan to live there, factor in notice periods, court calendars and a possible one-year stay, and negotiate accordingly;
• If you find someone living there, call an attorney right away to determine the occupant’s status before any notice is served. The wrong notice or a miscounted deadline can force the whole process to start over.

Attorney’s perspective

If you find a tenant after closing, we first review the contract and any lease, then decide whether to negotiate a move-out or proceed in Housing Court. See our landlord–tenant and eviction services.

For advice about your own situation, call +1 718-218-5805 or schedule a consultation. We meet clients in Flushing and Manhattan, in English or Chinese.

Series overview

This article is for general information only and is not legal advice. Reading it does not create an attorney-client relationship. For advice about your situation, please contact us.

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