I have a situation that I have never run into before, and I was hoping to appeal to the vast resource of knowledge and well thought out life advice, I always find here. :)

The short version (yes, I am aware that my post are often..."wordy". My apologies. lol) More clarifying details upon request

I have an accepted offer on a home sold as part of an estate sale.

A mystery relative has appeared and made a claim to part of the estate. (Not the home)

The seller is reluctant (as am I) to complete the sale until this mystery relative situation is resolved.

The lawyer for the seller has been dragging this out for far too long. There may be a good reason, but increasingly, it seems he is milking this payday. (it was a large estate.)

The home continues to sit vacant.

My idea...question...

I wonder if it is wise for me to "lease" this home from the seller w the option to sub lease. A 14 month lease would allow me to recoup the rehab expenses and turn a small profit on a home that I don't technically own.

Honestly, my goal is just to move the deal forward before the end of the summer.

I'm certain there is a name for this technique, but I don't know what it is or even if it's wise. I will take all warnings of pitfalls into consideration.

Could the mystery relative make a claim against income that I generate w the property?

If I went forward w this idea, how should I structure it?

How would I eventually claim the repair/rehab cost after closing?

What would you do?

Maybe this is more of a thought experiment for me, as I try to turn obstacles into solutions.

I would be grateful for any input, positive or otherwise.

Thanks in advance. :)

Very interesting scenario....

Estate laws are state-specific. Is there a Last Will and Testament for the estate? Who is the executor? Is that the same person as the Seller?

The idea you've proposed sounds similar to a sandwich lease. The Seller leases to a renter, who then subleases to someone else. This is a technique commonly used in "subject to" purchase and lease-option sales.

Regarding the mystery relative suing for the rent: until the estate is probated, any assets or income generated by assets held in the would be subject to probate, and the executor would have a fiduciary duty to the estate to ensure it was accounted for and paid out to the heirs. BUT, the executor could hire you as a property manager-- if the laws of your state allow a non-owner to manage a property without a broker's license--and pay you a reasonable fee perhaps.

GreatOne,

The technique I use is PATIENCE.

Review your offer for an expiration date so you don't remove yourself automatically.

Yes, a lawyer's job is to milk.

When we settles my parents' estates, we could sell real estate before everything was settled. The money simply went into the estate's account. The heir will not lose financially. A judge might have to approve the sale. If so, have a good description of the current state of the property with large photos, and comps attached to your purchase agreement. Maybe add mold remediation and repair quotes.

It's MY job to convince the judge or heirs how the property is run down and out dated, thus my low price. They might be out of town and don't know what the property looks like.

BRAD

Thanks Sid.

Great to know what it's called and a place to start my research/education. Thank you.

Yes, the seller is the executor.

I honestly hadn't thought about the need for a formal agreement about becoming the property manager. Good thought.

My ideal (not necessarily realistic)scenario is if the executor will turn over the property to me for the cost of taxes and property maintenance. (He has stated to me that the monthly cost of maintaining a long distant asset is too high. He has even hired me to take care of some "situations".

If I was able to pull off this minimum cost, Sandwich lease, wouldn't the profit to the estate be the amount of the lease between myself and the estate as opposed to the rent that I generate?

I may be grasping at straws, but I enjoy the thought process.

Thanks Brad.

Yup, patience and the willingness to walk away, is my go-to technique, however, this is a good buy and my patience is wearing thin. I am not certain that either the seller or myself is willing to go through the expense or formality of going before a judge.

I have had the same thoughts about completing the sale and the money going into an estate account, but I have been advised that the new relative could possibly contest that. If she contested, I would imagine that the generated income as well as the properties increased value, could come back to bite me. Hence the ongoing patience and my hope for a new solution.

I should also mention that as another one of my rental nears a doable payoff, I am itching to "do something" w the money that I have set aside for this purchase. I hate the feeling of waste.

Thanks again for your input. It is always informative.

The phrase "time is of the essence" should be in the sales contract.

I'm not one for the patience stuff. As was in the movie "the super" don't put no money in that building. I positively hate working in sales that are not foreclosures and this is exactly why. You been bustin it for HOW LONG and now some pebble gets into your shoe and its irritating. You spend weeks or even months working it and the rug gets yanked.

"HE who cares least wins". You are not the winner-- no brass ring and may not be.

I was buying a home from an estate when the real estate market was on the down swing. At the time the property was vacated for the sale and in okay as-in condition. The price was slightly discounted.

The sellers (estate) also dragged their feet. Nine months later they were ready to close the deal. The price/value had already declined to a lever below my offer. When I did an inspection I saw that the owners/estate tried to rent out the property but got deadbeats, freeloaders and some squatters who did extensive damage. By then the repairs and lowered valve was $100,000 less than my offer, so I pulled out. They had already broken my purchased contract by renting out the house until the sale could go through.

Then two years later I drove by the house and there was an open house. Fixed up and being marketed by the estates Personal Representative, the new list price was around $200,000 less than my offer. The market had declined that much from 2009 to 2011.

Thanks Myob.

I feel lucky to have made the deal that I have made on this home. I don't believe that the estate would have any trouble selling it again at the same price.

The seller wants to sell...I want to buy...the hold up is definitely the..incompetent...crooked....unconcerned (choose any combination) lawyer. I don't think trying to force a sell will solve any of those situations, only pass this deal onto someone else.

I tend to be skeptical of most things, and I have even gone through a phase of wondering if this questionable lawyer didn't put this "mystery relative" up to this. (He has encouraged the seller to settle w "No need for a DNA test".)...Weird. No-one has ever heard of this relative. To make matters worse (more curious), there are only 4 heirs (not counting the new girl). It would seem easy enough to resolve. Way too much weirdness for me to complete the purchase. Hence the attempts at creative solutions.

My current understanding is that the seller is in the process of firing the lawyer and seeking a new one.. Who really knows, though.

Thanks again. I would normally agree w walking away, but for many reasons, this is the right deal at the right time....Hopefully. :)

Wow Robert!

I am always envious of some of the deals that you share. I could only imagine to be as lucky, one day.

That being said, you are shopping w a LOT more zeros than I am. lol.

Maybe I should clarify.... The seller is willing to complete the sale. (I think), but as stated, there is some question of whether the mystery girl could contest the sale. A risk that I am not willing to take.

This is a first estate purchase for me. Looking from the outside, it has been a very interesting drama to watch, as it unfolds.

I'm trying to remember bits and pieces of something that was mentioned in passing.

I think someone had died intestate-- basically, without a will. And his heirs wanted to divide up the estate, and my attorney was assigned to probate the estate. Or something. So, the first thing to do was to call up the people who had known the deceased during life, and track down all his kids, and make sure there weren't any unaccounted-for periods of his life, or any children-on-the-side-we-don't-talk-about. Lots of really personal questions, but they had to be asked so that the estate could move on.

So then there's a thing in TX (and probably elsewhere) called an Affidavit of Heirship. And so the purpose of that is for someone to voluntarily swear to the truth of a set of facts regarding the deceased's heirs, so that things can move forward. So in this case, the people say things like, "I was his only wife," and "No, he didn't have any children to my knowledge outside of marriage" and "Yes, we only had three children together, A, B, and C." And you do this to everyone who knew him-- friends, family, relatives, neighbors, etc-- and see if everyone tells the same story with the same set of facts. And when you've made a reasonable effort to get things laid out properly, then the laws kick in, and the estate can be probated, even in the absence of a will, according to the default settings what state law sez needs to happen.

If there's a will in play, then you look at what the terms of the will were. There's a legal difference between leaving an estate to "my children" and "my children A, B, C, and D." With the "my children", it would be open to any of his offspring, if they existed elsewhere. But with "my children A, B, C, and D", it's my understanding that even if there were children E, F, G, and H, they still get nothing, because they weren't specified, whether they were known about or not known about.

As far as Robert J is concerned,Luck is out of the equation ,In your situation,I'd run.forget about walking,unless you can get a hold of Guido...........charlie........................................................

GreatOne,

IF a judge must approve the sale no one "goes before" the judge.

AN atty files a paper along with a copy of your offer and comps, judge signs it. Done. Perry Mason does not show up.

schedule the closing. If there's something hinky-- you won't be able to get title insurance. The atty is yanking your chain-- and in most cases it's so he can pass the deal to his BUD!.

Push for the sale. The only issue the benefactors might have is that the price isn't high enough or one of them wants the house to themselves.

You might want to insist on a quit claim deed from the mystery girl and all other relatives. They'd probably rather have the cash than the house and the expenses draining the estate to maintain it.

Wow. Lot's of great advice here.

Deanna. What a great explanation. Thank you for taking the time to explain that.

Brad. Excellent court info. Interesting that comps would even matter. Good to know.

Myob. That's reassuring . I'm not fully sure what the title insurance company would find concerning the "heir". Interesting. Yes, I have thought often about this attorney seeing the deal, and stalling so that it would fall apart. Like you said...Attorneys (and their friends)are on the front line of real estate investing. At this point I wouldn't put anything past him. :/

LL o the flies. Nobody wants the house (well..me) but I do worry that some may question the sales price. A quit claim is a great idea, but I can't help but think that making this person aware of this particular asset, may throw a wrench in the process. What do you think? One of the many reasons that I was hoping that the estate would get settled and we could move forward. I may use your idea as a blueprint for the next steps going forward.

Thanks again for all of the brilliant feedback. My responses are just my way of bouncing the ideas around in my restless mind. This is all new territory for me. I am grateful for the continued help.

Thanks again.

The job of the executor is to settle the estate. I doubt a judge needs to sign off on this or that the newfound gold digger relative is entitled to any say in the disposition of the home. They may be entitled to a piece of what it sells for, but they can't call the shots if they're not the executor.

Thanks #22

That is the way I imagined it is supposed to work, but have been advised (maybe badly?) that she could contest the sale at some point during the estate settlement. Having a potentially, sketchy lawyer in the mix hasn't made me feel any better, either.

If you don't mind me asking...record the contract, where? This has never come up for me.

Thanks in advance.