I have a very loose Right of First Refusal with my tenants on my fee simple home. They have told me they can't qualify until at least next January and the lease is up November 30, 2012. I now have a Buyer who is qualified and the Tenants are giving me a bunch of gobblydegook and acting like they may qualify for a VA loan... The Buyers are going with a Conventional loan. Since the ROFR does not specify time to qualify for a loan, whether their offer has to exactly match the other offfer, etc, do I have the ability to negate their offer if it is VA or for any other reason?
Country relating to Question: United States
State (if USA): Hawaii
Getting the Tenants to flat-out say that they cannot qualify for a loan right now... They're 95% there, but keep throwing uo smoke screens because they know they cant qualify but want the house anyway
Hello and thank you for asking your question. My name is XXXXX XXX I will be assisting you. Is your ROFR agreement in writing? If so, can you provide a summary of the specific terms agreed to in writing?
yes, its in my lease agreement and it says... "Tenants have a first right of refusal to purchase the property from Leigh Anne Leggatt, owner, at a purchase price based on Bank/Financing Appraised Value from lender but not less than the current County of Maui Assessed valuation of $523,300 as of 10/6/2011." I told them I would accept the $523,300, as a way to speed up their admitting they can't qualify, and now they're talking about a VA loan and being able to close in January... they had previously told me they can't qualify til next January.
Thanks for the additional information. I would think you could use the lease end date of 11/30/12 as a drop dead for them to exercise their option.
You can give them written notice now that you have a potential buyer and in accordance with their ROFR they have until nove. 30 to close.
That's what I think, too, but I don't want to
lose my Buyer's that I have right now... Is there a way to proceed with my Buyer's now??
You have a valid lease with your tenants and you also agreed to a ROFR. I don't know how you legally get around that issue.
The only way around it is to get your tenants to release the ROFR.
I'll try to do that... thanks... my screw up I guess... :((
Maybe offer them some cash in lieu.
ok, how much do you think might work? Is that a common thing??
There is some value to their option, and if they know they can't qualify, it would be free cash to them. Maybe offer it in the form of some sort of rent discount or abatement. First, you might want to send the letter detailing the expiration date of the option, etc.
ok, thank you! That's a great idea :))
You're welcome. Good luck!
Attorney licensed in multiple jurisdictions.
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