To be a bona fide lease under the Protecting Tenants at Foreclosure Act, the rent $ needs to be at “fair market;” the tenant can’t be an immediate relation; and the lease must be a product of an arm’s length transaction (i.e. no special deals for friends).
In your case, it would seem that you could challenge the lease on the “fair market” provision. Your tenant’s rent is evidently below market. However, the term “fair market” is nebulous (whim of a judge) and I would not want to challenge this in court vs a 90-year-old tenant. But the multi-year extension options may make it necessary to dispute the “fairness.” Probably best if you can work a lease buyout deal with the tenant. Given the age of the tenant, I would advise involving the tenant’s son in any such negotiations.
The PTFA also has a provision which nullifies a tenant’s lease when a new owner is “moving in” to the property (occupying as a primary residence). But unless you legitimately want to move in and live there, I wouldn’t try to exercise that escape route. Instead, I would explore a lease buy out negotiation.
The protections of this law apply to tenants under a ?bona fide? lease or tenancy. A lease or tenancy is ?bona fide? only if:
(1) The mortgagor or a child, spouse, or parent of the mortgagor under the contract is not the tenant;
(2) The lease or tenancy was the product of an arm?s-length transaction; and
(3) The lease or tenancy requires the receipt of rent that is not substantially less than fair market rent or the rent is reduced or subsidized due to a federal, state, or local subsidy.