Contract for deed; Can Sellers back out?!?! So Frustrated :(

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Latest post Sat, Aug 13 2011 9:48 AM by Drew. 11 replies.
  • Thu, Aug 11 2011 3:32 PM

    Angry [:@] Contract for deed; Can Sellers back out?!?! So Frustrated :(

    Good Afternoon,

    We have a contract for deed on a mobile home.  When we looked at the mobile the roof had been replaced in certian areas where the panels had been ripped off from a storm.  We were told that the roof did Not leak in those areas.  Upon move in Day it was raining, and in fact the roof did leak. Not in one room but in a total of all 3 bedrooms and the pantry as well.  Yes the celing was discolored, but was told it was a previous leek before they repaired the roof w/the different panels.  In our contract we are to maintain insurance on the mobile. However, we cannot find an insurance Company that will insure the mobile do to the way the roof looks. It has been sealed (which the sellers bought the sealent) But, the insurance companies (I had 4 adjusters come look) said they will not insure until the roof has been Repaired. 

    Now we have to shell out 3400-3900 for a new roof, that we cant do until we get taxes back this next year just to obtain insurance.

    Can the Sellers back out of the contract for deed due to the fact we cannot obtain insurance, even though they knew the roof leaked before we moved in? I have several email/text messages that confirm after we moved in they knew it leaked even when they specifically said it didnt before we agree'd to purchase.


    Thank you kindly for your responses.

     

  • Thu, Aug 11 2011 3:44 PM In reply to

    Re: Contract for deed; Can Sellers back out?!?! So Frustrated :(

    Butterfly_Kisses:
    Can the Sellers back out of the contract for deed due to the fact we cannot obtain insurance, even though they knew the roof leaked before we moved in?

    They can try.

    But if it's impossible to get insurance because the sellers failed to properly disclose the condition of the roof, you might be off the hook.

    But that's iffy because it was your responsibility to get the place thoroughly inspected before buying so you might not be off the hook.

    I would caution you on one thing though. Before you spend almost $4000 on property YOU DON'T OWN, you would be wise to consider getting out from under this deal because it's a bad deal from the getgo. We get plenty of posts here from people who have lost their shirts on contracts for deed because they put a lot of money into the property and then the purchase fell through for some reason. Seem to me that you are well on your way to joining those ranks.

    Consult an attorney and review your options before you spend the money on the roof.

     

    • The right of the people 
    • to keep and bear arms,
    • shall not be infringed.
  • Thu, Aug 11 2011 4:15 PM In reply to

    Re: Contract for deed; Can Sellers back out?!?! So Frustrated :(

    I understand it was our responsibility to have it checked out. But also their responsibility to disclose; which they did "after" we were moving in. (I have all corrospondence to show she admitted it did)

    I also asked why it didnt get repaired when they owned it with their insurance. Never did get an answer to that.

    We only owe 11,300 on the mobile. Am I obligated to provide these people proof of insurance? I dont want them knowing my personal business that can be obtained by the forms for the insurance.

  • Thu, Aug 11 2011 4:47 PM In reply to

    Re: Contract for deed; Can Sellers back out?!?! So Frustrated :(

    Butterfly_Kisses:
    Am I obligated to provide these people proof of insurance?

    What does your contract say?

    Have insurance?

    Or provide proof of insurance?

    Any consequences for not having insurance?

    Mortgage and loan contracts specify that the lender got copies of insurance and failing to produce copies resulted in the lender buying the insurance and adding the cost to the monthly payment whether the borrower had insurance or not.

    A lot depends on what your contract says. 

    • The right of the people 
    • to keep and bear arms,
    • shall not be infringed.
  • Thu, Aug 11 2011 5:04 PM In reply to

    Re: Contract for deed; Can Sellers back out?!?! So Frustrate...

    Our Contract says the following:

    Taxes and Assessments: During the term of this Agreement:

     

    Purchaser shall pay all taxes and assessments levied against the property.

     

    Contents Insurance: Purchaser shall be solely responsible for obtaining insurance of the contents, insuring contents owned by Purchaser.

    Liability and Hazard Insurance: Liability insurance shall be maintained by Purchaser during the term of this Agreement.

     

  • Thu, Aug 11 2011 5:16 PM In reply to

    Re: Contract for deed; Can Sellers back out?!?! So Frustrate...

    Butterfly_Kisses:

    Contents Insurance: Purchaser shall be solely responsible for obtaining insurance of the contents, insuring contents owned by Purchaser.

    Liability and Hazard Insurance: Liability insurance shall be maintained by Purchaser during the term of this Agreement.

    If that's all there is about insurance, then my opinion for the two cents it's worth is that you don't have to give the seller proof of insurance.

    Anything in the contract that addresses what constitutes default?

     

    • The right of the people 
    • to keep and bear arms,
    • shall not be infringed.
  • Thu, Aug 11 2011 5:31 PM In reply to

    Re: Contract for deed; Can Sellers back out?!?! So Frustrate...

    Here is the deed There is no mention of Default, Replaced personal information w/the XXX's

    THIS DAY this Agreement is entered into by and between XXX and XXX, hereinafter referred to as “Seller”, whether one or more, and XXX and XXX hereinafter referred to as” Purchaser”, whether one or more, on the terms and conditions and for the purposes hereinafter set forth:

     

    1. Sale of Property

     

    For and in consideration of Fourteen Thousand Dollars and Zero Cents ($14,000.00) including a down payment of Two Thousand Dollar and Zero Cents ($2,000.00), Making the Purchase Price of Said Property Twelve Thousand Dollars and Zero Cents. ($12,000.00) other good and valuable considerations the receipt and sufficiency of which is hereby acknowledged, Seller does hereby agree to convey, sell, assign, transfer and set over unto Purchaser, the following property located in Boone County, State of Arkansas, said property being described as follows:

     

    1993 16x80 Mobile Home 3 bedroom 2 bath, located at XXXXX, currently located in the Mobile Home Subdivision in XXXX. 

     

    Together with all rights of ownership associated with the property, including, but not limited to, all easements and rights benefiting the premises, whether or not such easements and rights are of record, and all tenements, improvements and appurtenances, including all light fixtures, plumbing fixtures, shades, blinds, curtain rods, storm windows, storm doors, screens, awnings, and decking if any, now on the premises.

     

    1. Purchase Price and Terms

     

    The purchase price of the property shall be $14,000.00. The Purchaser does hereby agree to pay to the order of the Seller the sum of 2,000.00 Dollars upon execution of this Agreement with the balance of $12,000.00 being due and payable as follows:

     

     

    (A) Balance payable, together with interest on the whole sum at the rate of 5% per cent, payable in the amount of $276.35 dollars per month beginning on the 1st day of June, 2011, and continuing on the same day each month thereafter until the 1st day of June, 2015, when all remaining principal and interest shall be paid (based on payment). With first payment due June 1st, 2010, with a 15 day grace period. Monthly payments shall be made to: Josh and Amanda Evans and sent to the following address: XXXXX

     In addition to payment it is the Purchasers responsibility to pay the sum of $125.00 per month in lot rent to XXXXX.

    If interest is charged, interest shall be calculated monthly and deducted from payment and the balance of payment shall be applied on principal. Amortization Schedule is attached.

     

    1. Time of the Essence

     

    Time is of the essence of each and every term and provision in this Agreement by Purchaser.

     

    1. Security

     

    This Agreement shall stand as security of the payment of the obligation of Purchaser.

     

    1. Maintenance of Improvements

     

    All improvements on the property, including but not limited to, buildings, trees or other improvements now on the premises, or hereafter made or placed thereon, shall be a part of the security for the performance of this contract and shall not be removed wherefrom. Purchaser shall not commit, or suffer any other person to commit, any waste or damage to said premises or the appurtenances and shall keep the premises and all improvements in as good condition as they are now.

     

    1. Conditional Improvements

     

    Purchaser agrees that the Seller has not made and does not hereby make any representation or warranties as to the condition of the premises or the condition of the buildings, appurtenances and fixtures locate thereon, and/or the location of the boundaries. Purchaser accepts the property in its “as-is” condition without warranty of any kind.

     

    1. Possession of Property

     

    Purchaser shall take possession of the property and all improvements thereon upon execution of this Agreement and shall continue in the peaceful enjoyment of the property so long as all payments due under the terms of this Agreement are timely made. Purchaser agrees to keep the property in a good state of repair and in the event of termination of this Agreement, Purchaser agrees to return the property to Seller in substantially the same condition as it now exists, ordinary wear and tear excepted.

     

     

    1. Taxes, Insurance and Assessments

     

    Taxes and Assessments: During the term of this Agreement:

     

    Purchaser shall pay all taxes and assessments levied against the property.

     

    Contents Insurance: Purchaser shall be solely responsible for obtaining insurance of the contents, insuring contents owned by Purchaser.

    Liability and Hazard Insurance: Liability insurance shall be maintained by Purchaser during the term of this Agreement.

     

  • Thu, Aug 11 2011 6:04 PM In reply to

    Re: Contract for deed; Can Sellers back out?!?! So Frustrate...

    Butterfly_Kisses:

    Purchaser agrees that the Seller has not made and does not hereby make any representation or warranties as to the condition of the premises or the condition of the buildings, appurtenances and fixtures locate thereon, and/or the location of the boundaries. Purchaser accepts the property in its “as-is” condition without warranty of any kind.

    Regardless of what the seller told you or didn't tell you, that paragraph makes you responsible for the roof replacement.

    There really isn't any way to look to the seller for improper disclosure because mobile homes are treated the same as automobiles. When you buy one "as is" you buy it "as is."

    You refer to that contract as a Contract for Deed. Mobile homes don't have deeds, they have titles. So that's not a Contract for Deed.

    Seems to me that it's a purchase contract where the purchase is financed by the seller and you should have had the title transfered into your name. Also looks like the seller sold it to you on the day you signed the agreement.

    Did you get the title transfered into your name?

     

     

    • The right of the people 
    • to keep and bear arms,
    • shall not be infringed.
  • Thu, Aug 11 2011 6:52 PM In reply to

    Re: Contract for deed; Can Sellers back out?!?! So Frustrate...

    The Title has not been transfered. I just asked about that and was told he would see what he could do tomorrow. Wouldnt it need to be in our name for the insurance to cover; with them as the lien? 

     

  • Thu, Aug 11 2011 9:42 PM In reply to

    Re: Contract for deed; Can Sellers back out?!?! So Frustrate...

    Butterfly_Kisses:
    The Title has not been transfered. I just asked about that and was told he would see what he could do tomorrow.

    Sounds like weasel words. But see how it goes. If it doesn't come to pass tomorrow I suggest pressing him hard for the title before you put any money into the MH.

    As I wrote, looks like he actually sold it to you and if he can't give you good title, you might have an out. You are certainly running a big risk without title. You should have insisted on it before you handed over the check for $2000.

    Butterfly_Kisses:
    Wouldnt it need to be in our name for the insurance to cover; with them as the lien? 

    Not necessarily. It's possible to have an insurable interest by contract on something you don't own. Examples include car leases, conditional sales contracts, real contracts for deed, etc.

    But that's not the point and certainly not something to bring up with the seller.

     

    • The right of the people 
    • to keep and bear arms,
    • shall not be infringed.
  • Sat, Aug 13 2011 9:41 AM In reply to

    • Drew
      Consumer
    • Top 10 Contributor
    • Joined on Thu, Mar 30 2000
    • PA
    • Posts 49,644

    Re: Contract for deed; Can Sellers back out?!?! So Frustrated :(

    Before you get into any conversations about any possible breech on you side of anything, I think you need to sort out title issues on a mobile in your state. Is your mobile a modular manufactured-details and issues vary by state.

    In some states title is like that of a car--and a bill of sale is not enough, other places a bill of sale counts.

    What you post looks like a bill of sale and it transfers all incidents of ownership up front--but its not safe to assume its enough in your state.

    Focus first on do you have clean ownership---subject to the balance due of course-and totally zip it as to insurance.

    Laymans view--the leak problem is your problem now, too late to win points that they needed to cover it.



  • Sat, Aug 13 2011 9:48 AM In reply to

    • Drew
      Consumer
    • Top 10 Contributor
    • Joined on Thu, Mar 30 2000
    • PA
    • Posts 49,644

    Re: Contract for deed; Can Sellers back out?!?! So Frustrated :(

    The contract says "as is."



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