L/O Gone Wrong For The Buyer
We entered into a l/o with a seller but 18months into the deal we find out that the people had a previous contract with the actual owner of the home. They say they were "assigning" their contract to us but we were never told that, nor did the contract say that. The people we were dealing with didn't purchase the home by the date they were suppose to so the actual owners took the home back and sold it! We still had 18 months left on our contract...seems like they should have told us it was "assigned". They are a LLC...can we sue them? We have not been refunded ANY $$$..are out thousands!!!!
That all depends on how the contract with you and the "middle man" was written. He has to have some type of clause in his contract to cover this. That the lease and all other paperwork to an attorney.
If I understand what you said correctly, they didn't have to tell you they were planning on assigning the Contract. They could have also done a collapsed closing. In that regard, they did nothing wrong; however, somewhere in the Contract it should have stated that they may not be the Owners of record. If not, you have a good case for fraud. That being said, as an investor, we have no right to grant a L/O term to a T/B for longer than we have control of the property with the Owner, so yes, you can sue, and my guess is you'll win. I'd report them to your state's Attorney General as well for criminal prosecution.
Mary1,
I am curious as to what type of due diligence you do prior to entering into a real estate contract of any kind. I am not criticizing, just suggesting.
I would suggest you use DataQuick or some other reputable service to gather your much needed property info. This would have helped you in this situation as this LLC certainly would not have been listed as owner of record.
I agree with LeaseOptionKing in that it sounds like you have a good case for fraud. Are you occupying this home presently? What was this LLC's explanations of their actions to you?
Dave
[addsig]
dealfinder,
What are some of things one must do prior to l/o, always run title search, check check county etc? How much does a title search/prim. report, cost in CA?
Which is the least expensive and simple checking to do to prevent this from happening?
In order to identify seller, do you ask for ID, driver license, etc.
How is the deal made, better be with attorney present or review? Can you walk thru the process since I am a newbie but learning a lot from this site though?
[ Edited by jamesCA on Date 09/03/2004 ]
[ Edited by jamesCA on Date 09/03/2004 ][ Edited by jamesCA on Date 09/03/2004 ]
This seems like a shady deal but I guess the research should have been done by the buyer in the begining. What was the easiest thing that could have been done in the beginning to prevent this, a title check?
Obviously you need a competent attorney, but you might find out the answers to these questions. First, to whom did the sellers sell this property to? Is the buyer of the property buying it as an investment, or to live in? You might be able to work something out with them. How did they sell the property without the buyer inspecting it? A property is normally sold with existing renters having rights, but apparently this L/O you have wasn't with the true seller, although I am wondering about the agreement between the two of them in regards to the term. All in all, it looks like you were a victim of fraud, not by the seller, but by the middle man who took your money and apparently didn't pay the actual owner of record. Sad, very sad. Take this as a lesson, those of you who have never done a deal, that when you deal in houses, you are dealing with someone elses life on both ends and should treat this business with respect and love for your fellow man.
Good Luck,
Shawn(OH)