seller wants to back out... - Posted by john

Posted by JT-IN on May 25, 2006 at 20:49:05:

I inadvertently read your response, which I many times will do, reading the response then the question… I must have then clicked onto the thread above the one you answered. Sorry.

But it surely seemed funny to me as I read it in that order, if you can imagine… (not making light of the ladies deceased husband here).

Anyway, thanks for pointing out my error here. Maya Culpa.


seller wants to back out… - Posted by john

Posted by john on May 25, 2006 at 16:14:38:

Hi, I met with a woman whose husband passed away sometime in the past. The home has about 15K in deferred maintenance that needs to be done but could probably sell for 200K once the work is completed. The lady told me she wanted 130K for it and I gladly agreed. I have received a call from her the other day as well as call #2 that a relative has suggested she not sell the house to me and that she acted too quickly. She has asked for me to release her from the contract. What are some ideas and thoughts on this? I am afraid she’s going to list with a Realtor or sell to another investor for a higher price. I really wanted this house because as a divorcing single parent this property would be perfect for myself and my kids. Any thoughts would be truly appreciated

Re: seller wants to back out… - Posted by Killer Joe

Posted by Killer Joe on May 26, 2006 at 24:32:28:


Tim has hit on a good idea, however, it will put you on notice that you are now condoning a retail bid. If you are inadvertently bidding against a friend or family member you will be the odd man out. That’s just human nature.

A more secure position is to have an escalation clause that states you will purchase the property for “up to $X, in $1000.00 increments over the previous bid”. That’s not the legal jargon, that’s the concept. Have the contract drawn up responsibly.

A person that will not match the next increment of bidding will have an uphill battle if they claim foul in the courts. If the money is “tied” it may depend on if the magistrate got kissed last night.

The increment you decide on should be a balance of you making a profit, and them NOT agreeing to their next step up in dollars, so they drop out, but are given every opportunity to make the decision.

Once you agree to open up the bidding, you are better off with a strategy that benfits your long term goals, than just throwing it wide open to every front. If no retail buyer shows up, you need to remember that an opposing bid by another investor has to be upped by $2000.00 in our scenario on their part to overcome your bid. Use that to your advantage on both ends. An additional bid of $2000.00 on your part may be the contributing factor to you not bidding, and moving on. HTH


My Idea - Posted by Tim Jensen

Posted by Tim Jensen on May 25, 2006 at 21:37:12:


This idea just came to me.

Let the lady know that you will be more than happy to let her out of the contract on one condition.

Insist that she signs a right of first refusal. This gives you the right to match any offer that the seller may get. Just make sure you record it.

Tim Jensen

Re: seller wants to back out… - Posted by JT-IN

Posted by JT-IN on May 25, 2006 at 18:17:48:

First off, you are going to have a hard time satisfying Al - Ct requirements, since her spouse has died… (Levity).


Depending upon which state the property is located, may have something to do with this… Some states are more lenient than other about contract rights and performance. It will also depend on the strength of your contract, and how specific the language is concerning default. Many agreements state what the remedy is, in the event of default. So as example, lets say that your contract stated that if seller defaults, they must return earnest money deposit, then you wouldn’t have much ground to run on. See what I mean here…?

The other factor that could come into play would be the age of the seller. The only factor is whether she had all of her facutlties upon execution of the contract. Sourts will sometimes be sympathetic toward older people who have made a blunder, and if that is the case, you may not fare too well here.

You could prepare an affidavit stating that you have a bonafide interest in the property, via a properly executed Purchase and Sale Agreement, between Mrs. Susie Seller and John (Doe), for property located at 123 Main St., on xxxx date. Sign that in front of a notary, attach a copy of the legal description to the affidavit, and rercord at your local county recorders offc. This will certainly get you a phone call from a title company, in the event that she did attempt to sell it to someone else, although that wouldn’t happen until they were ready to close and title report is compelted.

You could also attempt to put her on written notice, provided that you have an iron clad contract. That notice should state that you have recorded a memorandum of your agreement at the county recorders office, and in the event that she does not honor the terms of the agreement, you will file suit for specific performance.

Other factors depend on whetehr you are a ready, willing and able purchaser…? Are you ready to close within the terms of the contract…? Do you need financing…? Is there any problem there…? And on and on. Bottom line is forcing someone to sell their house to you may be an uphill battle, but it happens all the time. Or at least there could be some monetary damages if she does not sell to you. Playing a little hardball with the letter, etc, may get her to cave in and do the deal. You’ll have to decide how solid of ground you are with your contract, and whether you can stomach displacing the old gal…

Just the way that I view things…


Re: seller wants to back out… - Posted by Al-Ct

Posted by Al-Ct on May 25, 2006 at 18:44:46:

JT-IN my response was to owens thread not Johns.
Both spouses are alive and kicking from what I read.
Read one thread down. Al-Ct