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Legalease
Legalease, Lawyer
Category: Real Estate Law
Satisfied Customers: 16379
Experience:  13 years experience in RE Law, including LL/Tenant, contractor disputes, comm'l prop. issues
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5 years ago, I purchased a home via Contract (owner

Customer Question

5 years ago, I purchased a home via Contract for deed (owner financing). A balloon payment was due within 2 years. About 2 months before the due date of the balloon payment, I contacted the company on many, many occassions to get a payoff to give to the lender that I secured. I kept getting the runaround and no one would speak to me. I even had the lender contact them, and no one returned his calls either. They would, however, tell me verbally, that I shouldn't worry about it, its been very busy, but the sale would take place, even if it were a few days/weeks after the balloon payment was due. They even went as far to call me paranoid when I told them that I was suspicious because no one would give me paperwork or give me the info I needed to get my new loan, which was preapproved, pending notification and payoff info from them. Well, finally, 2 days, after the balloon payment became due, I got a call from the office manager, stating that I could no longer purchase the home because I had not secured a new mortgage or paid the balloon payment in time. I feel like this company mussled me out of my home! I told them that I was tricked out of my home, and I would continue to pay my monthly mortgage and I contend that I am still the owner of the home. For 3 more years, up until now, the company continued to take my payments, but after a recent appraisal they had completed, I got an eviction notice and a summons to go to court to get me out. Can anyone help me or tell me what I can do, if anything. I purchased a $7,000 fence, sent close to another $5,000 over the years on reparis and upgrades, Plus I had to put down $8,000 to make the purchase.
Submitted: 2 years ago.
Category: Real Estate Law
Expert:  Legalease replied 2 years ago.

Hello there --

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Were you actually evicted from the house and if so, how long ago was that?

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Do you have written paperwork showing that you had secured a mortgage prior to the loan payoff date (such as documents from the lender with a date prior to the loan balloon payoff date)?

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MARY

Expert:  Legalease replied 2 years ago.

Hello there --

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Were you actually evicted from the house and if so, how long ago was that?

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Do you have written paperwork showing that you had secured a mortgage prior to the loan payoff date (such as documents from the lender with a date prior to the loan balloon payoff date)?

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MARY

Customer: replied 2 years ago.
I was not evicted, but I have a summons to appear in court Sept 4th. I have a Contract for deed that was prepared when I first purchased the property.
Expert:  Legalease replied 2 years ago.

Hello again --

I understand that you have the Contract for Deed -- however, because your contacts with them appear to be all telephone calls, they will most likely claim that they either never got the calls OR that paying off the balloon payment was not discussed with you. Under these circumstances, if you are going to sue them for breach of contract, you will have to show a court that you had a mortgage loan ready to go to pay off the balloon payment (or that you had cash available to pay off the balloon payment) -- which documentation will completely blow away any defense that they might try to state that you were not able to make the balloon payment or that you never tried to make arrangements for the balloon payment. So long as you are able to show a court such proof, I think you have a fantastic claim for breach of contract and misrepresentation. Because you are still in the house, under contract law you have a 6 year statute of limitations to sue the owner for breach of contract and misrepresentation and seek monetary damages for everything that you put into the house and an additional amount for your aggravation. Unfortunately, there is no real way to force them to accept you as the purchaser at this time or to permit you to stay in the house -- because the court date is coming up so close, you would need to hire a local attorney in the county where the property is located immediately and the attorney would have to immediately file a motion in civil court for an injunction to stop the sale until the court reviews all of these matters -- however, courts are very reluctant to restrain the sale of any property and the most likely outcome if you prevail will be a monetary award for the value of what you have lost since the beginning of the transaction..

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Please let me know what additional questions that you have on this matter. I am very happy to answer them for you to try to assist you in developing a strategy regarding how to proceed in Virginia and what statements you should make to the court at the hearing on September 4. In this court action on Sept 4, the owner is obviously trying to evict you from the property and because the owner and any party connected to the owner (real estate agent, attorney) are going to try to claim that you were just a tenant unless you followed through on your part of the obligations in the Contract for Deed (in other words, because you failed the obligations of making the balloon payment, then YOU breached the contract and thus, the contract for the deed is null and void and they are under no obligation to sell the property to you at that point or give you the deed as set forth in your contract !!) AS a tenant, they are claiming the right to evict you / foreclose on you.

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It may be very difficult at this point to get a local attorney to assist you for the Sept 4 hearing (the notice is short), but you should try the local county bar association AND the nearest city bar association for referrals. If you find an attorney the attorney may be able to get the court to continue the matter for a few weeks which will give the attorney time to investigate the matter and file a Motion to Dismiss the eviction proceeding and a Motion for an injunction to stop the sale of the property to anyone else until your case is heard by the court (as I said earlier, it is a longshot to get the court to find in your favor when you seek an injunction and try to stop a sale -- because of the universal leanings of courts NOT to tie up a property sale - because it is better for business all around and it keeps cases moving more quickly through the court system, the courts and judges are more inclined to permit the sale to proceed and then award monetary damages to you if you win your Breach of Contract / Misrepresentation lawsuit against the owner and the real estate agent at a later date. ) However, if your attorney is not successful in getting a full injunction to stop any sale of the property until your case is heard, your lawyer should ask for a lien to be placed on the property in the full amount of what you are owed and which lien will either be PAID if you win your lawsuit or RELEASED by the COURT if you do not win in your Breach of Contract lawsuit).

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Finally, even if you are not successful in retaining possession of the property at the hearing and even if the court refuses to stop the sale of the property to another third party purchaser, you can still proceed with a full Breach of Contract lawsuit against the owner (with other charges such as misrepresentation added in against the owner and if I were representing you I would also add the real estate agent as a defendant and charge the RE agent with misrepresentation of the contract and the status of the property) -- The misrepresentation charges against both the owner and RE agent should be based upon their actions leading up to the due date of the balloon payment and deliberately misleading you into believing that they were on board with selling the property to you and accepting that balloon payment to make it all happen. All of these lawsuits are based in contract (or, as we say in the law "contractual in nature") and thus you have a 7 year statute of limitations to actually file the lawsuits against these parties (and any other party that you believe may be responsible for your losing the house in this crooked manner!!). Lawsuits regarding the breaches of written contracts can be brought for up to 7 years after the last actions on the contract were taken by either party (in this case, it would be the date of the balloon payment that was not made when due). If push comes to shove and you find it difficult to get an attorney to sue them without having to pay a large retainer fee up front for the services of the attorney, you could also draft the lawsuits against the owner and the real estate agent/broker yourself and sign the documents yourself and represent yourself in court (called "PRO SE" representation -- without an attorney). While there are no forms that you can use to prepare such a civil lawsuit (these lawsuits are drafted by the attorney writing it - from "scratch" if you will ) -- you can generally get a great deal of assistance at your local law library from the librarian there (there is usually a law library located at the county headquarters for each civil court for the public to use and the librarians are generally lawyers as well who can point you to the right direction regarding laws that you should cite in your lawsuit and cases, etc) . Finally, you may be able to find an independent paralegal (working on their own and not with a lawyer directly) to assist you writing the lawsuit paperwork -- if you are interested in something like that, you would have to keep an eye on Craigslist and even advertise that you are seeking to employ a paralegal to write some legal documents on Craigslist yourself.

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Again, please let me know if you have more questions -- I am happy to answer them for you. If not, can you please press a POSITIVE rating in the ratings section at the top of this page (either the middle star, the fourth star or the fifth star on the right hand side) -- this is so I will be paid for my time assisting you earlier today and tonight. I am paid NOTHING unless you press a positive rating in that ratings section so I truly DO appreciate it. Pressing a positive rating will NOT cost you any additional money -- it simply acts as the trigger to Just Answer to pay me for my time helping you here on Just Answer.

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THANK YOU VERY MUCH

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MARY

Expert:  Legalease replied 2 years ago.

Hello there --

I notice that you reviewed the answer I gave to you above and you have not asked any follow up questions or pressed a rating to conclude the session. Please let me know if you have any follow up questions on this issue. If not, can you please press a positive rating at the top of this page in the ratings section so I will be paid for my time?? I am paid nothing unless you press the middle star or the fourth or fifth star on the right hand side of the ratings section above. Doing so will not cost you any additional money -- it simply acts as the trigger to Just Answer to pay me for my time assisting you with this question and answer. Finally, even if you press a positive rating to close out this portion of the question, you can continue to ask any follow up questions related to the original question for as long as you like without additional charges. THANK YOU VERY MUCH !!

MARY