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Can I get My Security Deposit Back after Foreclosure

My landlord says my apartment building is being foreclosed, he may file bankruptcy, and he does not have my security deposit anymore. Do I have options under Massachusetts law?

Editor's Response

Yes you do. First of all, if the bank takes possession of your building, Massachusetts General Laws Chapter 186, Section 15B(1)(d) prohibits it from trying to collect an additional security deposit or last month's rent from you. That is the good news. If your old landlord transferred your deposit to the bank (as the law requires him to do), the bank is responsible to you for the deposit. However, if the landlord did not transfer it to the bank, you will have to try to collect it from the landlord. As you may know, your landlord should have deposited your deposit in a separate account that is protected from his creditor's. So it is no defense for him to say he lost the deposit to his creditors. You can sue the landlord for the deposit plus triple damages.

Finally, if your landlord does, in fact, file for bankruptcy protection, because of the automatic stay provisions, you will not be able to sue him until you get permission from the bankruptcy court. Unfortunately, in this situation, you will probably need to hire an attorney to assist you.

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