I leased my house back in February to a lady.
She is the only name on the lease as tenant.
She was living there with her husband, son and ex-husband (son’s father) weird I know.
Anyway, she was wanting to buy the house and have me owner finance it. Well since I haven’t paid it off yet, the way I set it up was with a 9 year and 11 month lease. Then we have a contract for option to purchase that kicks in after the lease is satisfied. This basically comes out to an owner finance with 10 year term. They are two separate agreements and neither mentions the other.
So, the lease started in February of this year (2010) and everything has been going fine. The rent has been on time or early each month. I found out two months ago that her, her husband and her son have moved out and left the ex-husband living there. She has continued to pay the rent during this time.
Now, there is rent due Monday and it looks like it’s going to be late. She won’t return my calls, emails or texts. I left a voice mail informing her that I was going to go by the house tomorrow and do a walk through to check things out.
The lease states that I cannot terminate the lease until the rent is 30 days late but it also states that the tenant shall not assign or sublet said premises or allow any other person to occupy the leased premises without Landlord’s prior written consent.
Would her moving out and leaving the ex-husband there by himself satisfy that part of the lease where I could terminate even though the rent is not 30 days late yet?
When she moved she didn’t give me her new address.
A little more info…
When we set up the option to purchase agreement she gave me $5,000 as a non-refundable option fee. I added wording in the lease where they could make improvements to the property and they have since put in a new privacy fence. She’s been having medical problems but has never not responded to my texts or emails. She’s only made eight rent payments thus far.
What would ya’ll do?
Hi,
This is probable not what you want to hear, and I would encourage you to seek legal council who specializes in real estate law as my knowledge of Texas law is a little rusty!
I think you should just allow provided the lease is paid the ex-husband or any one of the four of them to pay your lease reguardless of which one is there.
The Option you signed will legally be in force reguardless of who rent’s the property, I believe your going to find that you are locked in and liable to the option for 10 years reguardless of the buyer living there or not!
I think the only way to free your property of a 10 year liability requiring you to own it and rent / lease or pay the mortgage monthly yourself is to buy out the leasee, and that could take more than the option consideration funds they paid if they play hard ball!!!
I think a trip to a good attorney’s office is in your cards???
GR
Lease option, rent to own, and anything similar is tricky in Texas. I hope you had a lawyer write that up.
I suggest you take your contracts and consult a lawyer now.
If the lease and the option are separate, the option is still in effect for 10 years whether she is still renting or not. (consult the lawyer)
If the lease says she has 30 days to pay, she has 30 days to pay before you can evict her, and I doubt that gets rid of the option.
If the lease says she can not sublet and someone else is living there, you are going to have to give her a written notice to remind her of no subletting. However, if the current occupant was living in the house at the time the lease was signed, that person was a legal tenant at that time and is still a legal tenant, whether they were on the lease or not.
If nobody pays the rent, you can evict everybody. Name them all on the eviction, and then add “and all others”. But it sure sounds to me like you can’t do it for 30 days. Send and post a notice that rent is late and that you intend to proceed with eviction if rent isn’t paid, or house vacated and the keys returned to you.
Lawyer time, Kevin, to see what you have gotten yourself into.
I am not a lawyer but in general you will find that in Texas if you give more than a 1 year lease (a 10 year lease) the tenant actually has ownership interest in the property and you can’t evict you have to foreclose. Owner finance tenants never refinance out of the owner finance deal and generally you drive by and the house is empty. If you do evict and the tenant sues you it is possible for the judge to rule that the deal never happened since it is not legal and order you to give them their money back…all their money back the $5,000 and all the monthly payments. Judges don’t like doing that and it has not been done but you don’t want to be the first one.
I assume that everybody over the age of 18 in the house has been checked out background and credit checks which means that the ex husband qualifies to be in the house. Since the deal is to make money as long as they keep paying I would let them stay. I would however talk to them about how the arrangement has changed and you need to void the deal with her and make a lease with the ex-husband. The problem is that you can expect her to ask for her $5,000 back. I would not give it to her but that is the battle that you can expect.
If I could not find her to let her know the lease is changing I would send her notification to her “last know address” (the house in question) that you plan to change the deal and make a lease with the ex-husband. The ex husband can forward it to her but you are not responsible to chase her down, just make a reasonable attempt to contact her.
UPDATE:
I went by the house on Saturday and everything was moved out.
I finally got an email from her on Sunday saying that due to her medical problems that they could no longer afford the house so they moved out and were terminating the lease.
I’ve changed the locks and have another family moving in on November 8th that are renting it to start with until they get their tax refund in March. Hopefully, I can find a way to do an owner finance for them by then as they want to buy the house also.
If what I was doing the first time is wrong, how do you do an owner finance in Texas if you’re still paying the mortgage yourself?