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Old 02-20-2012, 10:44 AM
 
6 posts, read 37,468 times
Reputation: 11

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Clermont, FL

I signed a contract and put down earnest money, have all down payments and fees and am just waiting for a letter from the mortgage company who is dragging their feet. the contract says I have until March 15 to close. It was signed on Jan 23.

REA called last to tell me that if planned to rent the house (which I do), he has someone interested in renting at $500/month. I told him I already have a renter who will pay $750 so thanks but no thanks.

My future renter, who is a contractor and home inspector, called me this weekend to tell me the house is occupied.

REA told me we discussed it being rented and told me if the letter from mortgage company doesn't come this week I'll lose the house, not letting me make a counter offer if he has a better offer, which I am assuming he does.

Is the seller allowed to enter into a rental agreement while the house is under contract? I have called and emailed asking REA to provide me the agreement he made with the new renter.

added: REA never listed house as "pending" or "active taking backup offers" after contract signed on 1/23, but this weekend removed listing from MLS

thanks for input.

Last edited by lyaga; 02-20-2012 at 10:53 AM.. Reason: add locatation
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Old 02-20-2012, 11:23 AM
 
Location: Just south of Denver since 1989
11,813 posts, read 34,270,988 times
Reputation: 8930
Is the REA your agent, or the sellers?

What does your contract (was your offer signed by the seller?) say about mortgage commitment, tenants, etc?
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Old 02-20-2012, 11:39 AM
 
6 posts, read 37,468 times
Reputation: 11
REA is seller agent. Nothing in contract about renting or not renting under contract - below is from the contract, so it looks as though they can do this, but it seems disingenuous for them to have done so.

It looks again to me like the seller is wanting to get out of the contract.

***************************
LEASES: Seller shall, within 5 days after Inspection Period, furnish to Buyer copies of all written leases and estoppel letters from each tenant specifying nature and duration of tenant's occupancy, rental rates, advanced rent and security deposits paid by tenant, and income and expense statements for preceding 12 months ("Lease Information"). If Seller is unable to obtain estoppel letters from tenant(s), the same information shall be furnished bySeller to Buyer within that time period in the form of a Seller's affidavit, and Buyer may thereafter contact tenant(s)to confirm such information. If terms of the lease(s) differ materially from Seller's representations, Buyer may deliver written notice to Seller within 5 days after receipt of Lease Information, but no later than 5 days prior to Closing Date, terminating this Contract and receive a refund of the Deposit, thereby releasing Buyer and Seller from all further obligations under this Contract. Seller shall, at Closing, deliver and assign all original leases to Buyer who shall assume Seller's Obligation thereunder.
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Old 02-20-2012, 11:47 AM
 
3,599 posts, read 6,759,546 times
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This is Central Florida you are talking about. All of Florida for a matter of fact.

The sellers hasn't paid a single cent into the mortgage in probably close to 2-3 years. He's just collecting as much rent on the side as possible.

He could be trying to rent the home out again so the short sell fails. Or lock in for money from rent and create havoc.

I believe legislation in Florida increased tenant rights a couple of years ago. What happens if the lease is valid till until the end plus another 3 months. So seller is doing something fishy and maximizing his return before getting out.

Maybe seller and tenant are in this together and seller is cutting tenant a cut rate deal so they can stay in the home for another year.
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Old 02-20-2012, 12:05 PM
 
6 posts, read 37,468 times
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thank you for your input. I'm glad to have some confirmation that it sounds hinky - waiting to hear back from FL real estate attorney but trying to figure out how far to push it.

It's a shame as a close friend lives across the street and I have a renter lined up - and I was hoping to have this as a retirement home.

This isn't a short sale, but the seller accepted my first offer, so I got the price I wanted. some people....
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Old 02-20-2012, 12:53 PM
 
Location: Austin
7,244 posts, read 21,698,016 times
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In Texas, the house is sold in the same condition that the buyer agreed to buy it in. That means, if the house doesn't have tenants when the purchase is agreed to, it shouldn't have tenants at closing. What you copied and pasted is verbiage for if the property is already rented out. What does it say about the condition the property should be conveyed to you in?
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Old 02-20-2012, 01:09 PM
 
6 posts, read 37,468 times
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I appreciate the input - thanks.

I have re-read the contract several times and the only thing I see is the below (standard D is the portion I previously attached) - and it doesn't appear to have a timeline.

OCCUPANCY AND POSSESSION: Unless otherwise stated herein, Seller shall, at Closing, have removed all personal items and trash from the Property and shall deliver occupancy and possession, along with all keys, garage door openers, access devices and codes, as applicable, to Buyer.

**
If Property is intended to be rented or occupied beyond Closing, the fact and terms thereof and the tenant(s) or occupants shall be disclosed pursuant to STANDARD D.
**

If occupancy is to be delivered before Closing, Buyer assumes all risks of loss to Property from date of occupancy, shall be responsible and liable for maintenance from that date, and shall be deemed to have accepted Property in its existing condition as of time of taking occupancy, except with respect to any items identified by Buyer pursuant to Paragraph 12 prior to taking occupancy which require repair, replacement treatment or remedy.
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Old 02-20-2012, 01:15 PM
 
Location: Austin
7,244 posts, read 21,698,016 times
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And did you "otherwise stated herein"? I'm not an attorney and I will not interpret this for you, but will say for you to read it again.
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Old 02-20-2012, 01:20 PM
 
Location: Lakewood Ranch, FL
5,663 posts, read 10,670,093 times
Reputation: 6944
Quote:
Originally Posted by lyaga View Post
REA is seller agent. Nothing in contract about renting or not renting under contract - below is from the contract, so it looks as though they can do this, but it seems disingenuous for them to have done so.

It looks again to me like the seller is wanting to get out of the contract.

***************************
LEASES: Seller shall, within 5 days after Inspection Period, furnish to Buyer copies of all written leases and estoppel letters from each tenant specifying nature and duration of tenant's occupancy, rental rates, advanced rent and security deposits paid by tenant, and income and expense statements for preceding 12 months ("Lease Information"). If Seller is unable to obtain estoppel letters from tenant(s), the same information shall be furnished bySeller to Buyer within that time period in the form of a Seller's affidavit, and Buyer may thereafter contact tenant(s)to confirm such information. If terms of the lease(s) differ materially from Seller's representations, Buyer may deliver written notice to Seller within 5 days after receipt of Lease Information, but no later than 5 days prior to Closing Date, terminating this Contract and receive a refund of the Deposit, thereby releasing Buyer and Seller from all further obligations under this Contract. Seller shall, at Closing, deliver and assign all original leases to Buyer who shall assume Seller's Obligation thereunder.
This is really interesting and I hope you'll post what your attorney tells you. Assuming this is from the FAR/BAR As Is contract, it also says under paragraph 6. Occupancy and Possession: "If property is intended to be rented or occupied beyond Closing, the fact and terms thereof and the tenant(s) or occupants shall be disclosed pursuant to STANDARD D." Standard D is the part you quoted. So, I guess the first question is did they meet the date requirements? If not, you can get out of the contract, I would imagine or you could perhaps amend the contract to state that the property must be vacant at the time of the closing.

SORRY--I started writing this before you posted your comments.
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Old 02-20-2012, 01:21 PM
 
6 posts, read 37,468 times
Reputation: 11
No, did not "otherwise state". It's a pretty simple contract with the only additional term that seller pays closing fees of XXX.

bbronston: I'd be happy to post reply. However, I'm not the one who wants out of the contract (as originally signed). I'm guessing the seller does. I would like to purchase this property - if it hasn't been made too complex.

thank you all

Last edited by lyaga; 02-20-2012 at 01:24 PM.. Reason: added response
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