Need Help with Seller - Posted by ChuckP

Posted by ChuckP on March 25, 2000 at 14:52:57:

He’s on the backside of a divorce and I think he has feelings for the house. I have never seen a deed like the one he had. As a matter of fact, the county had even mis-filed the deed. It was a Special Assumption Deed with vendor’s lien from his former wife to him. He was gungho and kept calling me asking when was I going to take his house. However, when I got there he didn’t want to sign, but I “reasoned” with him and he signed. I cannot speculate as to his reasons. When I sat down with him the guy was staring blankly at the Austin (Travis County) doppler radar station talking about how two realtors had tried to sell the house and how his mother was in the hospital.

Anyway, I’ll lock him in with a L/O and record a memorandum of option. I’ll try to get a deed, but I’m not going to push him. This is a capital gain deal and not a cash flow deal, so I plan to create a note and sell quick. That’s my exit given the equity and how fast things are going in that section of town.


Need Help with Seller - Posted by ChuckP

Posted by ChuckP on March 25, 2000 at 07:55:08:


First the numbers:

3/2 ~1600 sq ft in a very hot area. Loan balance is ~80K and a CMA has put the house at 110-120K. The seller has signed a Purchase Offer for 80K, but has backed out saying he wants to do a lease/option instead. The house needs cosmetic work ( painting and some carpentry ~3K).

Should I go ahead and do the lease/option even though he has signed a Purchase Agreement (to put the house into trust) and the house needs some repairs? I told the owner that I would, because I did not want to lose the deal. We meet this Wednesday to get the paper work for the lease/option completed.


Re: Need Help with Seller - Posted by B.L.Renfrow

Posted by B.L.Renfrow on March 25, 2000 at 13:02:59:

What is the seller’s reasoning for wanting the L/O instead of sale? Presumably, he feels more comfortable keeping the deed in his name?

If you can L/O it for the same $80k option price, I’d certainly do it. However, make certain you record a memorandum of option or a performance mortgage to protect your interest, since this seller has already demonstrated a change of heart from what he initially agreed to. If you do go with the L/O, I’d also try to get the deed executed by the seller now, then held in escrow until you exercise.

Brian (NY)