How Do You Guys Handle.......
it when a tenant/buyer leaves the property in terrible condition? Do you have to go back and use your downpayment money as rehab money?
Murphy
it when a tenant/buyer leaves the property in terrible condition? Do you have to go back and use your downpayment money as rehab money?
Murphy
You are probably allowed to sue the tenant for damages. I say probably because it largely depends on state law and the legal contracts you used.
If you have a security deposit, you use that.
Take pictures of the damage, and itemize everything. Take monies out of deposit, and if you still need money to cover all the damage, the go to small claims court and get a judgment against them for damages.
It sounds like sueing would be answer if I were a landlord, but if i am using a Contract for Deed, It seems like that wouldn' t work. The way that I understand it, I would be selling the house, not renting it. Man, is sueing the only answer......
Murphy[ Edited by Murphyj2000 on Date 06/27/2004 ]
if you don't know the process for sueing and have to get a layer its a lossing deal. the attny. will cost more than the "normal" wear and tear. the only way is to go to small claims court and represent youself. my layer told me if i used him i would win but he would charge more than the claim and yes if they made a disp. take damage money from it.....kenmax[ Edited by kenmax on Date 06/27/2004 ]
Hey Murphy,
Is this just a what if question, because I have not had a tenant buyer, who just put several thousand dollars of their hard earned money down, then go and trash the place. They are working toward purchasing and I am beside them to help them purchase the home that they are in.
I have noticed the several properties that I have done L/Os that the tenant keeps up the property like they own it, which is usually good. If they dont, I encourage them that keeping up the property will only help them when it comes time to do an appraisal.
Murphy, one other option to consider before suing. Find a new tenant/buyer with a no money down, you fix up type deal. You get to keep your profits from the original deal and if done right the new T/B will fix it up to their satisfaction not necessarily yours. Basically allow them to use their "fix up" money as their option payment. Just be weary for people who claim they will fix it up but don't. Remember to be creative with your investing. If you find the right T/B they will take pride in the repairs because the will own it someday, Right?
The original message referred to a "tenant/buyer".
No detail was provided as to the legal agreements being used. I also can not tell if this is theory or a practical question.
People who intend to buy are generally less inclined to leave a place a mess. If the contract originally signed was fair and they just decided not to go forward even less reason to trash the place.
If a L/O you are a landlord and have the normal recourse of any landlord.
If you have sold on a Land Contract or Contract for Difference then you sold the place and need to get it back. As the seller you likely have little real recourse other then take the place back.
The amount you receive on the way into the deal is your protection. If you spend it on something else and then have little available to do anything in terms of repairs you have a bit of a problem.
As noted you can find another 'buyer' and see if you can cut a deal with them (they do the repairs). Be careful is you go this route as you are depending on them to perform and will again have no cash as a back up.
John
[addsig]
Thanks for everybody responding with such good advice.
This topic was just something that came to mind while i was investigating Owner Financing and the Sub2 process.
Yes Rick. Its more a "what if " question. The situation that came to mind is me selling to a married couple. Then all of a sudden they want a to seperate and not keep the property up to the standards that i would like it to be.
If anyone have been in a situation similar to this one, your input would be appreciated.
Mrmattress, I really like your idea about letting the new buyer keep their up front money. I would have never thought of that.
Murphy