Seller Died Now What?
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Seller Died Now What? (by Katherine [TX]) Mar 9, 2012 10:47 AM
       Seller Died Now What? (by reid [KS]) Mar 9, 2012 11:11 AM
       Seller Died Now What? (by Robert J [CA]) Mar 9, 2012 11:24 AM
       Seller Died Now What? (by Mike [TN]) Mar 9, 2012 11:29 AM
       Seller Died Now What? (by Katherine [TX]) Mar 9, 2012 1:09 PM
       Seller Died Now What? (by Susan [OH]) Mar 9, 2012 1:45 PM
       Seller Died Now What? (by in [IN]) Mar 9, 2012 2:28 PM
       Seller Died Now What? (by BillS [CO]) Mar 9, 2012 3:22 PM
       Seller Died Now What? (by Carolyn [MO]) Mar 9, 2012 3:23 PM
       Seller Died Now What? (by Katherine [TX]) Mar 9, 2012 4:12 PM
       Seller Died Now What? (by Mike45 [NV]) Mar 9, 2012 5:21 PM
       Seller Died Now What? (by Ken [NY]) Mar 9, 2012 7:26 PM
       Seller Died Now What? (by jack [DE]) Mar 10, 2012 5:28 AM
       Seller Died Now What? (by jack [DE]) Mar 10, 2012 5:28 AM
       Seller Died Now What? (by Mike45 [NV]) Mar 10, 2012 11:48 AM


Seller Died Now What? (by Katherine [TX]) Posted on: Mar 9, 2012 10:47 AM
Message:

Well it seems I am getting quite the education in real estate this year.

My owner carry deal just fell apart of the moment because the seller (whose relative had a power of attorney and had entered into a contract to sell me granny's house and carry the note) just died ahead of the closing.

So the relative's power of attorney was revoked per the law upon death and now the house goes through probate as part of the estate.

The way I understand things, the court will now have to recognize the listing agreement with the listing agent, and then assuming that happens, the court will have to recognize my contract to buy the property.

Could get tricky because the heirs will all have to agree that granny's house is to be sold, and somebody is going to have to agree to carry the note. The estate may not carry it, even though we had worked out a short term balloon deal (essentially to get me 24 months time to secure more permanent financing.) The guy with the POA was originally going to carry on bahalf on the estate. Maybe he still will, but that will have to be OK with the court, etc. etc.

Anybody ever had something like this happen?

I'm expecting the process to take several weeks or months, which is fine so long as I am allowed to assess the property and structure condition once the sale contract is cleared to more forward.

The listing agent is in my broker's office, and I have expressed that I am happy to buy the place once the whole probate thing works out and provided the property condition does not materially change in that time, and provided somebody will carry the note for the 24 months.

Ideas? Thoughts? Did I miss anything important? I think I can get out of the contract if I wanted to. I'm going to talk with my broker and see what happens with the earnest money for the moment.

Right now I'm thinking all I have is a possible claim against title but nothing more.

--64.233.xxx.xxx




Seller Died Now What? (by reid [KS]) Posted on: Mar 9, 2012 11:11 AM
Message:

I'd get busy and lobby the Heirs emphasizing how good deal this is for everyone concerned. If they are all out of the area it may be easier cause it could be a PITA for them to take care of things long distance. If there is a Local atty handling affairs I'd get on his good side ASAP. Then be patient as these things take time That Atty's get paid well for (LOL) --108.220.xxx.xxx




Seller Died Now What? (by Robert J [CA]) Posted on: Mar 9, 2012 11:24 AM
Message:

I got sick of trying to get anyone to listen or help me deal with "estate" issues. After so many months working a deal and to be at the mercy of so many, I simply recorded a lien against the property and filed a law suit. This tied up the property from a sale to someone else. Soon after, the Personal Representative, estate attorney, executor and heirs all contacted me to see what in the heck I wanted????? To complete the transaction as agreed. --173.58.xxx.xxx




Seller Died Now What? (by Mike [TN]) Posted on: Mar 9, 2012 11:29 AM
Message:

RE sales contract will stand if the seller dies before closing. The estate has to sell it to you with the same price as I understood.

It's the seller carry the note part that is getting iffy. That could be a different issue. The heirs may not like the point that they have to wait for 24 months to get their money. Since there may be more than one person, that could be more problems as how is holding the note and so on. --198.51.xxx.xxx




Seller Died Now What? (by Katherine [TX]) Posted on: Mar 9, 2012 1:09 PM
Message:

That's the whole thing Mike. I was doing seller carry to give me two years to consolidate some other things, pay off some loan balances and get into a stronger position to prepare for the 2 year balloon, which I had suggested.

I'd rather not have to lay out 30% down when that money can be used to pay off a loan balance and improve portfolio cash flow. That is what even my local bankers are charging, and it really is not a good use of capital since things will cashflow well with less down.

I guess for now I'll simply wait a little while. I don't have to buy this house. There will be others if this one doesn't work out. --64.233.xxx.xxx




Seller Died Now What? (by Susan [OH]) Posted on: Mar 9, 2012 1:45 PM
Message:

Most estates aren't settled for 24 months anyways...and most states have state-specific probate rules. If I were you, I'd either google TX probate or go to the library and get a book on settling estates-that may answer your questions. --65.189.xxx.xxx




Seller Died Now What? (by in [IN]) Posted on: Mar 9, 2012 2:28 PM
Message:

I was doing seller carry to give me two years to consolidate some other things, pay off some loan

Sounds like you need to talk with the Attorney handling the estate, his interest is selling not keeping the property, the listing agent also has the same desire. --98.253.xxx.xxx




Seller Died Now What? (by BillS [CO]) Posted on: Mar 9, 2012 3:22 PM
Message:

This is your chance to get out of the deal. When you presented it before it did not get great reviews so it was not that good to begin with. Personally I would look for other property and if they can make it work on your terms (2 year seller carry) then so be it. If not, then it was not to be and move on.

You could also give them an offer at a much lower price but with no seller carry. Something you could flip and make it worth your while. --75.160.xxx.xxx




Seller Died Now What? (by Carolyn [MO]) Posted on: Mar 9, 2012 3:23 PM
Message:

Since you have some flexibility in waiting this one out, you should be able to make this happen if you still want it ot.

I once bought a house in which the now deceased long time owners had no children. Their heirs were various nieces, nephews, cousins, etc who were scattered all over the west coast and wanted to sell - but it took the agreement of all for this to happen. By the time I considered it, it had been on the market for more than a year. It was overpriced, but they were all thinking of west coast prices.

I made an offer with a 10% down payment and seller financing amortized over 20 years but with a five year balloon. I made the offer in August, it was accepted during September, only because the agent sent them a list of every house on the street for sale - and there were many, many I could choose from. The agent was thrilled at my offer and worked very hard at it, as no one had even given a nibble before.

But then the nightmare began. I had a deadline of closing and recording of documents by the end of December as I could get a special tax credit if done during that calendar year, which made the purchase realistic. I kept calling the real estate agent, he kept calling all of the relatives. We needed death certificates, etc. = and about a dozen signatures.

I finally received the documents the morning of the last day they could be recorded, and I took them to the court house and had to beg them to process them that day. They did, but only after I walked them through the various steps. --70.255.xxx.xxx




Seller Died Now What? (by Katherine [TX]) Posted on: Mar 9, 2012 4:12 PM
Message:

Bill - Yes it is my chance to get out of the deal. Its a solid deal. Cash flows from the get-go with the financing, and is in a good area with nice homes all around and sits on a big lot that I could make a nice flip or expansion if I decide to go that route.

So I think that making a lower offer with no owner carry and doing a flip might be a viable option.

Right now I just want to sit tight and see what happens. I'm planning to pay one loan off in April, and another in September if all goes as planned.

The additional cash flow from doing that will allow me to accelerate other paydowns or get ready to do an all cash deal (at a lower price) on this one.

I'm not the only investor in town doing this, so right now I'm fairly happy having a title claim since that essentially ties up the property and clouds title, so this will discourage other buyers, without obligating me.

This is not a property that is going to go at bottom barrel because of the land it sits on and the area its in. Its also a pretty solid house. This is the first transfer since the house was built in 1949.

Not bad in my view. I could always file suit if it comes to that as suggested above, but I'm not in a rush to buy, although it would be a nice property to have.

Really, 2 years? Hopefully we'll get a deal done before then. I know my broker and the listing agent are anxious to get a deal done. More than I am frankly right now. --64.233.xxx.xxx




Seller Died Now What? (by Mike45 [NV]) Posted on: Mar 9, 2012 5:21 PM
Message:

As a general rule of contract law, your contract was NOT discharged by the death of the Seller. (Texas might have other laws, but this is the common law rule.) Therefore, the Estate is bound to honor the contract, including the seller financining part of it.

--71.49.xxx.xxx




Seller Died Now What? (by Ken [NY]) Posted on: Mar 9, 2012 7:26 PM
Message:

I agree with Mike(NV)in my area the realtors contract even says it is binding on heirs etc --67.252.xx.xx




Seller Died Now What? (by jack [DE]) Posted on: Mar 10, 2012 5:28 AM
Message:

Only your lawyer can answer the question, once all the facts are presented, not some wanna be lawyers on this site

In general you have a valid sales agreement, the real question is do you have a valid owner financing agreement?

Impossible for anyone to chime in with that answer who is not a lawyer in TX

Probate has many levels, for example: the estate creditors have a priority over your claim, plus the sale at this point increase the assets subject to tax and the estate cannot claim the 250K deduction ,then can the estate bind the heirs for 2 years? Yet still have a taxable event occur? What about the terms and a default possibility that you cannot obtain financing within 2 years? Who bares the expensive of the foreclosure process if the heirs do not want to extend the loan? Each heir? Do all heirs need to agree to extend or can one refuse? Since at that point the estate would have been settled

It may work out or are you willing to drop a few grand to litigate? If the heirs balk

But to simply imply the owner financing is going to go on without a hitch is intellectual dishonesty

--216.30.xxx.xxx




Seller Died Now What? (by jack [DE]) Posted on: Mar 10, 2012 5:28 AM
Message:

Only your lawyer can answer the question, once all the facts are presented, not some wanna be lawyers on this site

In general you have a valid sales agreement, the real question is do you have a valid owner financing agreement?

Impossible for anyone to chime in with that answer who is not a lawyer in TX

Probate has many levels, for example: the estate creditors have a priority over your claim, plus the sale at this point increase the assets subject to tax and the estate cannot claim the 250K deduction ,then can the estate bind the heirs for 2 years? Yet still have a taxable event occur? What about the terms and a default possibility that you cannot obtain financing within 2 years? Who bares the expensive of the foreclosure process if the heirs do not want to extend the loan? Each heir? Do all heirs need to agree to extend or can one refuse? Since at that point the estate would have been settled

It may work out or are you willing to drop a few grand to litigate? If the heirs balk

But to simply imply the owner financing is going to go on without a hitch is intellectual dishonesty

--216.30.xxx.xxx




Seller Died Now What? (by Mike45 [NV]) Posted on: Mar 10, 2012 11:48 AM
Message:

@ Jack [DE]: I stand by my post. If Texas applies the normal common law, the contract is binding on the Estate. Including the Seller financing provisions.

It is possible that the Estate will be left open until the 24 month financiing is paid off, or the Note and Deed of Trust can be distributed to the heirs/beneficiaries. That is not Katherine's question or her problem.

--71.49.xxx.xxx





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