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Can I decide not to sale in Texas with a sign Lease Purchase Option?
I rented my house out to my brother 3 years ago. He paid my loan directly as I lived out of town and had never had a problem as far as I knew. However I began recieving phone calls from my lender my house was in foreclousure and I was in default of my loan for having sold my house to someone else without autorization. I called my brother several times but got no responce. The lender informed me my house had lost its insurance coverage because I was no longer the lein holder. After researching records I found my brother has forged a letter stateing he was now the owner and paid someone to notorize it without me. He in turn filed it at the Appraisal office thus changeing names on ownership. He then found a person to give him $5000 and he signed the house over to this new person in a wrap around lein. Once I realized what had happened I threatened to turn him in so he droped all claims and got the tennant to drop claims the house was returned to my name on the appraisal. However the tennant who thought she bought the rights to take over payments from who she thought was the owner was now living in the house. I have since paid over $2500 to the house to take it out of foreclousure and get it insured. Except I still wanted to do the right thing by the tennat as much as I could I offered to support her in any lawsuits she may bring forth against my brother and assit her with home ownership program applications. I placed her on a lease with no deposit or additional money for her to pay other then her regular rent. I told her if she found funding I would sell her the house at the end of the lease term of one year. We signed a Purchase Option Agreement with a sale price but no money to me or additional rent going toward the purchase price or equity rights. I also agreed to reiumburse her for some of the money she put into the house even if she wasnt able to qualify for funding. I was able to find her a loan program she may be able to qualify for, However with the loan process being so long and tedious I would rather not have to start over myself and would perfer just to move back to the property and build up equity before I sale it. In my attempts to do the right thing by this tennant I promised to give her the option to buy before I really thought through whether I wanted to sale it. Can someone please let me know what I can do?
I have already began the process of pressing charges on my brother my question is what to do about the tennant he defrauded do I have to sale her my house?
3 Answers
- DonaldLv 79 years ago
That's a real mess. Upfront: I'm not a lawyer, so I can't offer legal advice. And you definitely need a lawyer. However . . .
First, you're in deep trouble, and you keep compounding it. Let's start at the end. You can not do a lease-option (or purchase option) in Texas for more than 6 months unless you're very, very careful. See the source listing below. But the point is: You didn't do what's required. (In the other 49 states, you'd probably be OK. Not Texas.)
Second--though some lenders don't care--a lease-option is the conveyance of equitable interest . . . just as if you'd sold it to your brother. You've conveyed an equitable interest to your tenant. Your lender didn't like it before when it invoked the "due on sale" clause. It probably won't like it this time, either, if it finds out.
Third, it's admirable that you want to do the right thing for your tenant. Still, you have to protect your interests, too. And your tenant should have taken certain steps, such as a title search, to make sure that your brother really owned the property. So she's got some responsibility, too.
OK. So what do you do? Short answer: See a lawyer. I suspect that what needs to be done is getting rid of the purchase option. That may not be too difficult since I'm sure it wasn't properly drawn up, and probably doesn't comply with a bunch of Texas laws. But that's hanging over your head like a sword. Then, convert the tenant to a true tenant. A pure renter. Or else sell her the property. If she can get a loan, great. If not, you could do owner financing though, for a number of reasons, I wouldn't recommend it in this case.
Meanwhile, make sure that everything your brother mucked up has been straightened out and that you're clearly and solely on the deed. You'll have to make sure everything's OK there (no cloud on the title) before you even consider selling the place.
But, again: See a lawyer. Make sure that the past problems with the deed are corrected. Get rid of that purchase option agreement. Decide whether the tenant will remain as a tenant. Or sell--cleanly--to the tenant.
That's what you do.
Hope that helps.
- 5 years ago
the respond relies upon on what's written on your hire purchase settlement. in case you only have an option to purchase it on the top of a definite era then it may look logical the corporate could have the alternative to no longer sell too. Your option settlement will dictate who gets to do what and whilst.
