I have a property under contract and a buyer in place to pay my assignment fee.However, a realtor got a hold of my seller and convinced her that she could sell it for more by listing it.The seller has now listed the property but our contract is still good for a couple of weeks.How can stop the seller from crossing me out?Also, I don’t want to burn bridges with my buyer.
The seller can’t list the property with a Realtor since you have it under contract unless you and the seller agreed to it in the contract. You have the right to force the seller to sell to you exclusively. Once their name is signed they are contractual obligated. Any listing agreement between the seller and the Realtor would be invalid unless you release the seller from the contract or it expires.
Well it all depends. How solid is your contract? Are there any “weasel” out clauses for your sellers? If so, what is the terminology used? In the contract what are the measurements that you are allowed to take in the event of a breach of contract? My contracts are drafted to say, “If the seller breaches the contract for any reason, I have the right to seek specific performance”. Some contracts that i use also gives me the right for an additional fee to be paid for a breach of contract.
How is your clause specifically worded? If you have anything close to this in your contract you have the write to take the seller to court. If your only dealing with 2 weeks left in your contract you may not have enough time to take them to court before your contract becomes null and void, however, you will have the right to sue the seller for your projected loss in profit.
Out of curiosity, What are the numbers in this deal? How much profit would you have made. Many times it’s just easier to move on to your next deal and cut your losses. That is what I would recommend doing, however, you do you have your rights so it is totally up to you.
I agree with both of you…your contract is enforceable to the degree which it says it is.
In either case I would record a notarized Affidavit and Memorandum of Agreement Concerning Real Estate at the municipality courthouse where the property is located. This clouds the title. If the Realtor closes during your contract term they HAVE to come through you because it’ll pop up on the title search. Then you can either block the sale or demand payment to release the affadavit.
Said agreement can be found at http://www.larrygoins.com/files/Free%20Forms-Docs/Forms/Affidavit%20and%20Memorandum%20of%20Agreement%20Concerning%20Real%20Estate.pdf
NSU1997 is totally accurate and I was going to recommend that idea myself, however, that agreement must be signed prior to the seller backing out to be recorded. It is highly unlikely that the seller will willingly sign it and cloud the title now that he or she has moved on.
This would have been ideal if it were done beforehand.
I bought the house for 6k, estimated repairs are30k and ARV is 65k. I stand to miss out on nice profit.I will take your advice and cut my losses .I WILL use a memorandum agreement on all future deals.This situation really burns but I’m wiser now. Thanks for the advice you guy.
Nice profit indeed, however, more then likely it will not go your way because all of your back up paperwork was not in place. Therefore, your time wasted trying to make wrongs right on this deal will cost you a decent amount of profit ($$$$$$) as well … Time still means money my friend…On to the next one :beer
If you don’t have this thing sold quickly you run into situations like this sometimes. No crying over spilled milk, go an get another home. Plenty of them out there. :biggrin
Your contract is still good for a couple of weeks, so get it paid for and closed in that time frame.
If you’ve gt a contract, you can probably force performance. You can at the very least, tie her property up so she can’ sell it elsewhere.
By the way, did you record your contract? Makes a difference.
Me, I’m not going to deliberately get myself into a lawsuit, so I’d move on and look for the next deal…
Just fyi the affadavit does not need to be signed by the seller. There’s not even a place for them to sign. You don’t even have to inform the seller you’re doing it actually…if they try to deal you out, then they will find it out the hard way. If the Realtor hasn’t sold the house yet there’s no reason not to record it right now. I would go record it immediately.
Disclaimer: do not abuse this document (ie, try to extort money out the deal when you’re the one who couldn’t close, etc). They have a place for you if you do. Comes with free room & board and 3 squares a day. :grim
NO! RECORD THE AFFADAVIT! You have nothing to lose but $30 or whatever your county charges to record one sheet of paper.
Fill it out, sign it in front of a notary (you sign as the “Affiant”), get a witness or 2 to sign, and take it to the courthouse to get it recorded. Then just sit back and wait for their closing agent to call you bitchin’ about this title cloud! Stick to your guns when they call. Tell 'em you had a contract first, and you’ll happily release the affadavit in exchange for however much you think you would have made if you did the deal or whatever. Based on your numbers I bet you coulda wholesaled the contract for $5-10K cash.
Let us know how it works out.
I would never do that…makes your whole entire deal public info…I’d record the affadavit instead.
Totally agree. However there’s no need to initiate a lawsuit with this deal.
You should have about a week left on that contract, what did you decide to do?
NSU I like you lmao!~This is a pure example of …when keeping it real goes wrong!
Well what happened?