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Thanks for all of this great advice. You all have a lot of good ideas. We're still talking things over and figuring our situation out.
WRT to the tenant, in MA, when we take possession of the house, their agreement with the previous landlord stays intact. Even though it is a verbal month-to-month agreement, there is a reasonably long timeline that needs to be followed.
We would need to give them notice one month (or one rental period, whichever is greater) before they leave. However, the last day of their tenancy must end on the last of the month. In practice, this means that they must receive written notice in the mail prior to the last day of the month, or they get to stay 59 more days.
After those 59 days, if they decide to force the issue, they can stay. We would start eviction proceedings. Those can run anywhere from an additional 2-4 months, depending on how much they fight. If they say they have nowhere else to go, the judge can tack on additional time.
From what our lawyer told us, we could have up to six months with them as renters (perhaps unpaid) during that process, along with a $5,000+ legal bill. If they are indeed leaving in October, but say that they'll fight the process, they could make it all the way in the house.
An unsigned purchase and sale agreement is toilet paper.
Actually . . . I would say toilet paper is more useful. This being said, it's not the attorney's fault that the P&S is unsigned.
Quote:
Originally Posted by Silverfall
Only in east coast world does the buyer pay fees and such out of pocket without having an executed purchase and sale agreement. What attorney allows their clients to incur expenses without a meeting of the minds? Crazy, in my opinion.
This is actually quite an uncommon occurence. Typically, a title search is order by the lender (not the agent as in this case) and is not ordered until after the P&S is signed. Generally speaking, the only out of pocket expense a buyer should be incurring in MA between accepted offer and execution of P&S is the Home Inspector's fee.
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Originally Posted by Silverfall
This ^^^ and this...
I know that language is not in my offer form and I've never seen it in any offer form before (most agents in my area use the exact form I use). Frankly, I don't like that clause and wouldn't use a contract that had it in there.
Quote:
Originally Posted by Silverfall
That whole offer, then purchase and sale agreement thing attorneys do on the east coast is such a waste of time and energy and clearly creates problems, as it did for the OP. We don't do that here. What a mess.
Everything I see about states that do the offer then purchase and sale agreement thing with attorneys is such a mess. Our offers are contracts and time is of the essence from the get go. Buyers don't spend any money without a contract. We can disagree, but from where I sit, the attorney's don't do a very good job of protecting buyers out there.
I much prefer our "attorneyless" transactions out here. I do have a company attorney that I consult with all the time on situations/clauses but he doesn't muck things up like this situation. I just don't see good buyer protection in this scenario.
Our offers are binding contracts just like yours. Time is of the essence here just like it is in your state. In truth, I do find the added step of the P&S a bit redundant but I like it because it's offers more specific language than the offer sheet about various situations that may pop up which can be useful in cases of disputes and I like that the attorneys are involved because I am not an attorney. I'm not an expert in contract law and any agent who claims to be one (but doesn't have a JD) should have their license revoked. Additionally, it's an opportunity to add into the contract issues that came up during the inspection. In the end, I find it's what you're used to. I like attorneys and you don't. I hate lock boxes because they're not used in my area and I'd be willing to bet you use them in your area and are a proponent of them.
Out of curiousity, in your state, once you have the inspection how is the resolution the parties have agreed to made binding? Do you have the inspection before you put in an offer? Do you draft an addendum to your offer? Is it left to faith that the seller will live up to their end? I'm always interested in hearing how things are done in other parts of the country.
Thanks for all of this great advice. You all have a lot of good ideas. We're still talking things over and figuring our situation out.
WRT to the tenant, in MA, when we take possession of the house, their agreement with the previous landlord stays intact. Even though it is a verbal month-to-month agreement, there is a reasonably long timeline that needs to be followed.
We would need to give them notice one month (or one rental period, whichever is greater) before they leave. However, the last day of their tenancy must end on the last of the month. In practice, this means that they must receive written notice in the mail prior to the last day of the month, or they get to stay 59 more days.
After those 59 days, if they decide to force the issue, they can stay. We would start eviction proceedings. Those can run anywhere from an additional 2-4 months, depending on how much they fight. If they say they have nowhere else to go, the judge can tack on additional time.
From what our lawyer told us, we could have up to six months with them as renters (perhaps unpaid) during that process, along with a $5,000+ legal bill. If they are indeed leaving in October, but say that they'll fight the process, they could make it all the way in the house.
Andy
Eviction is messy in this state. Alternatively, they could tell you they're leaving in October and then end up staying forcing you to evict them then. Even if the seller gives them notice it's quite possible they may not leave and eviction might be necessary. Personally, I'd want it in the contract that the premises are to be delivered vacant and I'd want to see in the property vacant prior to the closing.
In Oregon, yes that is how it would work. The new owner would give the tenant the required 30 day notice to move out. If they don't the new owner gets to evict them.
Ok, so not so different on the east coast. The eviction process can be a huge pain in the behind.
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Actually the tenant has legal rights to the property. That is what a lease is. A legal right to occupy a property with specific terms. Just like CC&R's stay on the deed regardless of who owns the property, leases are similar. They run with the land for a specific period of time. That is why only crazy buyers (not investors) take on a property with a tenant still in it. Not worth dealing with the landlord tenant laws that come into play with those.
I hear you, and I do understand what you are saying. But in the OP's case, there is no lease. No written and signed lease between seller and tenant.
This is why I only buy in my local college town/city. Students move on, yearly.
Actually . . . I would say toilet paper is more useful. This being said, it's not the attorney's fault that the P&S is unsigned.
Why is the attorney delivering an unsigned document? What's that about?
Quote:
Originally Posted by MikePRU
of curiousity, in your state, once you have the inspection how is the resolution the parties have agreed to made binding? Do you have the inspection before you put in an offer? Do you draft an addendum to your offer? Is it left to faith that the seller will live up to their end? I'm always interested in hearing how things are done in other parts of the country.
We don't have an offer sheet because the purchase and sale agreement is 10 pages. It has all the specific language and then we have an additional 20 addendums or so to address the other language needs not in there. The attorneys will tell you that the contracts we have will cover 95% of real estate transactions.
I like attorney's and we have some exceptional local real estate attorneys. I just don't like them being in the middle of a process they don't need to be in. I don't claim to be an expert on contract law but the contracts were written by a group of real estate attorneys and they cover most issues within real estate. The few times they aren't covered, we bring attorneys into our transactions. Most local attorneys will tell you that they don't want to be involved in regular real estate transactions and those are best left to agents.
We don't do inspections before we have a contract. The buyer has typically 10 business days to get their inspections and due diligence done. Yes we draft repair addendums to our contracts all the time. Our attorneys have written us really nice ones that we use. Everyone in the state uses the same contract (not required but we do) to make sure we all know how to interpret it and such.
All contracts are based on good faith. The seller trusts that the buyer will turn in their documents to the underwriter. The buyer trusts the seller to do agreed upon repairs on time. The entire process is about acting in good faith. Agents are there to ensure both parties are doing what they are supposed to be doing. Having an attorney isn't going to change a buyer or seller being a jerk if that is the course of action they are going to choose.
Why is the attorney delivering an unsigned document? What's that about?
It's not the attorney's job to chase down signatures. They write the document. It's what they're good at. The agents get it signed because getting things done is what we're good at.
Quote:
Originally Posted by Silverfall
We don't have an offer sheet because the purchase and sale agreement is 10 pages. It has all the specific language and then we have an additional 20 addendums or so to address the other language needs not in there. The attorneys will tell you that the contracts we have will cover 95% of real estate transactions.
I like attorney's and we have some exceptional local real estate attorneys. I just don't like them being in the middle of a process they don't need to be in. I don't claim to be an expert on contract law but the contracts were written by a group of real estate attorneys and they cover most issues within real estate. The few times they aren't covered, we bring attorneys into our transactions. Most local attorneys will tell you that they don't want to be involved in regular real estate transactions and those are best left to agents.
We don't do inspections before we have a contract. The buyer has typically 10 business days to get their inspections and due diligence done. Yes we draft repair addendums to our contracts all the time. Our attorneys have written us really nice ones that we use. Everyone in the state uses the same contract (not required but we do) to make sure we all know how to interpret it and such.
All contracts are based on good faith. The seller trusts that the buyer will turn in their documents to the underwriter. The buyer trusts the seller to do agreed upon repairs on time. The entire process is about acting in good faith. Agents are there to ensure both parties are doing what they are supposed to be doing. Having an attorney isn't going to change a buyer or seller being a jerk if that is the course of action they are going to choose.
Sounds like your system is not as different as I would have thought. We have a binding contract before inspection as well. The reason I like attorneys to be involved is that the contract is tailor made to fit each situation. 90% of the time it's the same but it's nice to have the flexability when we need it.
This sounds like a no-win situation, esp with the laws in MA that favor tenant's rights. If the tenant says he has nowhere else to go, the judge could extend? Crazy...
Can the OP even get insurance on the home if a renter is in there? I would doubt it. Also, if the OP has to evict the tenant, the tenant could do all kinds of damage to the place.
All I see are huge risks if the OP tries to stay with this home.
Meanwhile, can you contact the broker and see if he can resolve some of the issues with your agent? Maybe you could get some of the costs refunded (the title search for example)
I don't know that much about real estate, but rule #1 is if you buy a place with a tenant, your first priority is to get that tenant OUT and verify this before you close. Buying a home with a tenant still in there is so risky. Most agents won't even recommend letting the seller stay on for a few weeks (and pay rent) just b/c they then turn into month to month tenants!
It's not the attorney's job to chase down signatures. They write the document. It's what they're good at. The agents get it signed because getting things done is what we're good at.
Sounds like your system is not as different as I would have thought. We have a binding contract before inspection as well. The reason I like attorneys to be involved is that the contract is tailor made to fit each situation. 90% of the time it's the same but it's nice to have the flexability when we need it.
But it isn't binding with the important terms. You add those important terms after the buyer pays for inspections. That is crazy. The ONLY thing up for negotiation, out here, after the contract is executed is repairs. Our contracts are as-is contracts so there doesn't have to be negotiation, but you guys are still negotiating dispute terms and such. That's insanity.
Some buyers can spend $1,500 on home inspections, especially on old homes. We have to walk into those inspections as solidly as possible contract wise otherwise the risk is really great for them. Having a contingency in the offer that it is subject to "mutual agreement of the purchase and sale agreement" is bad for buyers. Bad. That's like a seller accepting a financing clause that says "subject to buyer finding a loan of their choice." That's bad for sellers. Those kinds of clauses allow buyers and sellers to act in bad faith, legally, and get out of deals. Yucky.
I still contend that attorney's that allow their clients to spend any money out of pocket before having a contract that has minimal contingencies or removal of vague clauses isn't doing a good job.
Why would you continue to wait and change things for a home just because the seller does not want to get the tenant out? The tenant is not the one buying the home you are, who cares if it is an inconvenience for the tenant. What about your inconvenience? What about the time and money you have already had to spend and invest in all the changes? Who is this realtor? Do you seriously want to give your money to owners who are more interested in their tenants convenience than your money and do you seriously want to give the realtor a commission even though she seems to be working for the seller and not you even though YOUR MONEY PAYS HER.
You are crazy if you continue with this nonsense. I would never trust a seller who is more interested in their own agenda and their tenants convenience or a realtor who is blatanly not working for you and your best interest.
I would also have the attorney draw up papers and send the realtor and the sellers a bill to pay all of the fees you have already paid including your attorney's fees AND additional monies for breach of contract and emotional stress (if that is legal).
Exactly!!! This is beyond ridiculous to put you through this. Get some legal help and get your house. Keep us updated.
Reminds me of why I love real estate in Oregon without attorney's. If it were me, I would walk away and when the house is still on the market in July, reoffer then. Who does a 6 month purchase and sale agreement? A better house could come on the market in the meantime and then you'd be bound to this one with a crazy seller.
Yep, you are bound, and they have fudged around this whole time, 2 different rental timeline extensions...ludicrous!! They are jerks. How much money have you sunk in now?? How do you know what the interest rates will be in 6 mths.
This renter obviously knew it was for sale, DUH! How the heck is this renter getting away w/ controlling this sale. I am shocked!! And, mad for you.
PLUS.....
3. After home inspection, sellers don't want to give tenant notice, breaking our owner occupied mortgage. They broke the contract!
4. Sellers verbally agreed to deliver the house vacant. We have a P&S (sadly, unsigned) sent by their lawyer that stated that the house would be delivered vacant.Check w/ the State Bar.... Why would an attorney send a worthless document??? There is something very fishy about this whole thing. IMO
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