ORS § 90 § 90.367
Application of security deposit or prepaid rent after notice of foreclosure; termination of fixed term tenancy after notice.
Operative Text
(1) A tenant who receives actual notice that the property that is the subject of the tenant’s rental agreement with a landlord is in foreclosure may apply the tenant’s security deposit or prepaid rent to the tenant’s obligation to the landlord. The tenant must notify the landlord in writing that the tenant intends to do so. The giving of the notice provided by this subsection by the tenant does not constitute a termination of the tenancy. (2) A landlord may not terminate the tenancy of a tenant: (a) Because the tenant has applied the security deposit or prepaid rent as allowed under subsection (1) of this section. (b) For nonpayment of rent during the month in which the tenant applies the security deposit or prepaid rent pursuant to subsection (1) of this section unless an unpaid balance remains due after applying all payments, including the security deposit or prepaid rent, to the rent. (3) If the tenant has not provided the written notice applying the security deposit or prepaid rent as required under subsection (1) of this section before the landlord gives a termination notice for nonpayment of rent, the tenant must provide the written notice within the notice period provided by ORS 90.392 or 90.394. If the tenant does not provide the written notice, the landlord may terminate the tenancy based upon ORS 90.392 or 90.394. (4) Application of the security deposit or prepaid rent pursuant to subsection (1) of this section to an obligation owed to the landlord does not constitute a partial payment under ORS 90.417. (5) If the landlord provides written evidence from a lender or trustee that the property is no longer in foreclosure, the landlord may require the tenant to restore the security deposit or prepaid rent to the amount required prior to the tenant’s application of the security deposit or prepaid rent. The landlord shall allow the tenant at least two months to restore the security deposit or prepaid rent. (6)(a) A tenant with a fixed term tenancy who receives actual notice that the property that is the subject of the tenant’s rental agreement with a landlord is in foreclosure may terminate the tenancy by delivering a written notice to the landlord specifying that the tenant has received notice that the property is in foreclosure and that the tenancy will terminate upon a designated date that is not less than 60 days after delivery of the notice unless within 30 days the landlord provides the tenant with written evidence from a lender or trustee that the property is no longer in foreclosure or with written evidence that a receiver has been appointed by a court of competent jurisdiction to oversee the operation of the property. (b) If the landlord does not provide the tenant with written evidence as described in paragraph (a) of this subsection within the 30-day period after delivery of the notice of termination, the tenancy terminates as provided in the notice.
Oregon Revised Statutes § 90.367 establishes specific rights and procedures when a rental property enters foreclosure. A tenant who receives actual notice of foreclosure may apply their security deposit or prepaid rent toward rent owed, provided they notify the landlord in writing, and this action does not by itself end the tenancy. The landlord is prohibited from terminating the tenancy solely because the tenant exercised this right, and a tenant with a fixed-term lease may also choose to end the tenancy early by giving at least 60 days' written notice if the property is in foreclosure. If the landlord later provides written proof that the foreclosure has ended, the tenant may be required to replenish the security deposit or prepaid rent over a period of at least two months.
Plain English — not legal advice.
Under ORS § 90.367, property owners and managers whose properties enter foreclosure must recognize that tenants have the legal right to apply security deposits or prepaid rent toward rent obligations upon written notice, and initiating a termination action solely because a tenant exercised this right is not permitted. If a nonpayment-of-rent termination notice has already been issued, operators should be aware that a tenant may still provide the required written notice within the cure period established by ORS 90.392 or 90.394. Should the foreclosure be resolved, landlords who wish to require restoration of the security deposit or prepaid rent must provide written evidence from a lender or trustee and allow the tenant a minimum of two months to restore those funds.
General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.
ORS § 90.367 gives tenants who receive actual notice of a property foreclosure the right to apply their security deposit or prepaid rent toward rent, as long as they notify the landlord in writing before or within the applicable notice period under ORS 90.392 or 90.394. Tenants with fixed-term leases have an additional option under this provision: they may deliver a written notice to terminate the tenancy, with the termination date set at least 60 days out, unless the landlord provides qualifying written evidence within 30 days that the foreclosure has ended or a court-appointed receiver is overseeing the property. Tenants who believe their rights under § 90.367 have been violated may consider contacting a local tenant-rights organization or Oregon's legal aid services to understand available options, including raising a violation as a defense in any eviction proceeding.
General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.
Generated October 7, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.
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