Quiet Title Action?
Wrote a two year lease purchase option with a landlord with us (LLC) as the buyer/tenant with full rights of sub-tenants and assignment. We also notarized and recorded a performance mortgage guaranteeing the lease purchase option, along with the lease purchase itself. Landlord also signed and notarized a deed on escrow at title company which we have a copy of (which, by the way is useless because all deeds in escrow ultimately need the sellers final approval before recordation anyway - if there are any disputes the title company just gives the original title back to the seller if requested). Now that our sub-tenants occupy the premise (it was vacant for months), the landlord wants to back out. He has violated our mortgage and we would like to foreclose, but of course there is also a primary lender existing, so we would be second in line. This is a good deal and we’re are not about to let it go. Anybody have info on foreclosing in a situation like this? We would also like to get a restraining order as he is bothering our tenants.
Thanks
To better understand your situation, so that I can better answer you, I need to ask a few questions.
1. Did the landlord/seller receive consideration(a down payment) at the time he signed the lease purchase option?
2. If so,did the landlord/seller agree in writing that the consideration was adequate for him to sign the agreement?
3. Has two years passed since he signed the lease purchase option?
4. How many months was the property vacant prior to your sub-tenants occupying it?
5. Who was responsible for the payment of the loan on the property during the vacant months?
6. How has he violated your mortgage?
7. How is he bothering the tenants?
8.Were there any promises not fulfilled per the contract on your part?
Hi Darryle-Ca.
To better understand your situation, so that I can better answer you, I need to ask a few questions.
1. Did the landlord/seller receive consideration(a down payment) at the time he signed the lease purchase option?
2. If so,did the landlord/seller agree in writing that the consideration was adequate for him to sign the agreement?
3. Has two years passed since he signed the lease purchase option?
4. How many months was the property vacant prior to your sub-tenants occupying it?
5. Who was responsible for the payment of the loan on the property during the vacant months?
6. How has he violated your mortgage?
7. How is he bothering the tenants?
8.Were there any promises not fulfilled per the contract on your part?
1) yes
2) yes
3) no
4) unknown
5) owner(him)
6) By violating the lease purchase option in guarantees. Among other things, our lease gives us the exclusive right of possession of prop and he is actively soliciting a prop mgmnt Co (they called me)
A. He has faxed over a hand-written note stating he wants our tenant out. That violates our exclusive right to sublease.
B. He has signed a property Mgt agreement with another company after he signed our contracts. That violates our exclusive right to sublease.
C. He states he has no intention of selling the property to us. That violates our “It is the intention of the Landlord/seller to sell the premise to Tenant/buyer” clause and our “…exclusive option to purchase” clause.
D. He no longer wants to lease to us, violating our “…is hereby leased to tenant/buyer for 24 months” clause.
E. He calls his hand-written note an “amendment” to our agreement, violating our “…may not be amended or released, in whole or in part, except by a document signed by the parties” clause.
F. Our mortgage also states he “…fully warrants the title to said land, and will defend the same against the lawful claims of all persons whomever.” And to “meet both the letter and the spirit of the agreement evidenced by said option contract dated 5/2/05 entitled residential lease purchase agreement, and perform, comply with and abide by each and every of the stipulations, agreements, conditions and covenants of said option contract and of this mortgage, …and shall pay reasonable attorneys fees which the Mortgagee may incur in enforcing the option contract secured by this mortgage…” He has now stated in writing he has no intention of doing any of this.
7) He was peering through the property’s windows at night (definitely not advised in Nevada!) when my tenant came out and asked him who he was and what he was doing. He replied he was the owner and they must leave. (they’re still there)
None.
I also have several previous phone messages and email where he identifies himself and asks for the “lease agreement with option to buy contract” and mentions the property by address, my name, as well as his own. I have the fax confirmation of the lease being sent to him 10 days before he met personally with me and my secretary to sign at the title company.
Quote:
On 2005-05-12 17:04, 4KASH wrote:
Hi Darryle-Ca.
To better understand your situation, so that I can better answer you, I need to ask a few questions.
1. Did the landlord/seller receive consideration(a down payment) at the time he signed the lease purchase option?
2. If so,did the landlord/seller agree in writing that the consideration was adequate for him to sign the agreement?
3. Has two years passed since he signed the lease purchase option?
4. How many months was the property vacant prior to your sub-tenants occupying it?
5. Who was responsible for the payment of the loan on the property during the vacant months?
6. How has he violated your mortgage?
7. How is he bothering the tenants?
8.Were there any promises not fulfilled per the contract on your part?
1) yes
2) yes
3) no
4) unknown
5) owner(him)
6) By violating the lease purchase option in guarantees. Among other things, our lease gives us the exclusive right of possession of prop and he is actively soliciting a prop mgmnt Co (they called me)
A. He has faxed over a hand-written note stating he wants our tenant out. That violates our exclusive right to sublease.
B. He has signed a property Mgt agreement with another company after he signed our contracts. That violates our exclusive right to sublease.
C. He states he has no intention of selling the property to us. That violates our “It is the intention of the Landlord/seller to sell the premise to Tenant/buyer” clause and our “…exclusive option to purchase” clause.
D. He no longer wants to lease to us, violating our “…is hereby leased to tenant/buyer for 24 months” clause.
E. He calls his hand-written note an “amendment” to our agreement, violating our “…may not be amended or released, in whole or in part, except by a document signed by the parties” clause.
F. Our mortgage also states he “…fully warrants the title to said land, and will defend the same against the lawful claims of all persons whomever.” And to “meet both the letter and the spirit of the agreement evidenced by said option contract dated 5/2/05 entitled residential lease purchase agreement, and perform, comply with and abide by each and every of the stipulations, agreements, conditions and covenants of said option contract and of this mortgage, …and shall pay reasonable attorneys fees which the Mortgagee may incur in enforcing the option contract secured by this mortgage…” He has now stated in writing he has no intention of doing any of this.
7) He was peering through the property’s windows at night (definitely not advised in Nevada!) when my tenant came out and asked him who he was and what he was doing. He replied he was the owner and they must leave. (they’re still there)
None.
I also have several previous phone messages and email where he identifies himself and asks for the “lease agreement with option to buy contract” and mentions the property by address, my name, as well as his own. I have the fax confirmation of the lease being sent to him 10 days before he met personally with me and my secretary to sign at the title company.
9.How many months did the property remain vacant from the date of the signing of the lease purchase option and the date of occupancy of your sub-tenant?
10. Did you pay rent to the landlord/seller during that vacancy period?
11. Did the seller/landlord have the capacity to contract and if so did the agreement say so?
12. Was the landlord/tenant in the right state of mind when he signed the agreement and did he acknowledge that fact?
Hello
My point about the vacancy was when HE had it it was vacant. We signed the contracts 5/2/05. We had a tenant in it w/i days, now he wants to back out, i.e., this can be seen as using us to fill a problem/vacant property and then "cancel" agreements keeping OUR tenant. The seller is the single and sole owner of record since the property was built. The previous property mgr has visited the property today and told OUR tenant not to pay us anymore rent.
9.How many months did the property remain vacant from the date of the signing of the lease purchase option and the date of occupancy of your sub-tenant?
10. Did you pay rent to the landlord/seller during that vacancy period?
11. Did the seller/landlord have the capacity to contract and if so did the agreement say so?
12. Was the landlord/tenant in the right state of mind when he signed the agreement and did he acknowledge that fact?
Thanks Mantis
A few simple points;
1. Our tenants have paid us exactly what we paid the owner, so we are not out a dime.
2. Our Mortgage is a valid lien that was perfected/recorded the day the owner signed it along with a lease purchase agreement. Consensual liens like a mortgage secured by property is the only type we use and take precedent over virtually all other liens, regardless of when they were recorded, i.e., our lien would have precedence over Statutory (mechanics, tax) and Judgment liens, even if they were recorded before our lien.
3. The other business we run is a Nevada Asset Protection Company, so the LLC we do lease purchase deals under is very well protected and threats of counter-suit will not deter us. For starters, this particular Nevada LLC is an operating company that owns no assets and is funded by debt. The assets are held by a holding company. The holding company is a multi-entity Series LLC which does not conduct business with anyone, so the possibility of legal action is very remote. The members of the operating company are made up of two LLCs and a FLP. It does not have individuals as members.
4. As far as paying for an asset search, we already found a suitable asset, the house in question. It has plenty of equity in it and the chances of the owner further encumbering the property with our mortgage in place will be very difficult if not impossible.
This property is in Nevada.