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Foreclosure Questions

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posted on Sep, 4 2012 @ 02:32 PM
I just had lunch with a friend. As it turns out he's very angry because he got a five day notice on the door to his house. He has five days to move out his entire family, his wife and four kids, because the bank will foreclose on his house and sell it to action. (Note: this is not me as I am completely single at this time.)

He has been making one thousand dollars a month in rent to buy it for a few years now.

So what happened?

As it turns out the people he was buying it from weren't making any payments to the bank. They pocketed the money for themselves so the bank is foreclosing on them. This seems to be happening to several other people in town and may be more widespread across the nation.

So, it sounds like that in order to prevent the bank from foreclosing on others in this manner, one has to watch out and make sure that the owners are making payments on the house for you.

But I'm not sure how this could be done, other than to hire a detective of some sort to investigate the owners.

So the question I put to you is, how can we take steps to make sure that the payments are being made by the owners that won't get you in trouble? And if that's not feasible, could there be a legal way to bypass the owners and make the payments to the bank?

posted on Sep, 4 2012 @ 02:46 PM
Was this a 'Rent to Own" property?

If so, your friend probably comes under the Landlord Tenant laws, These are different in every state.

posted on Sep, 4 2012 @ 02:53 PM
The following is my opinion as a member participating in this discussion.

Depends upon the laws in the state where this happened. Typically, any real estate transaction for anything other than month-to-month rent must be in writing. He may have a cause of action against the seller (owner) for breach of contract. It depends upon what was agreed to. If there isn't anything in writing, he's probably out of luck. Then again, in some states, you have additional rights if you've occupied a residence for a specific period.

The mortgage company is the first lien holder, or title holder (again, depending upon the state) and they're going to get paid first, if anyone does.

He needs a lawyer.

As an ATS Staff Member, I will not moderate in threads such as this where I have participated as a member.

posted on Sep, 4 2012 @ 02:57 PM
reply to post by EvilSadamClone

Your friend needs to make an appointment with an attorney that specializes in real property. Make sure he brings every scrap of paperwork pertaining to the home (original contract, receipts for any equity he's put into the property, cancelled checks, property tax receipts, etc.).

He may not be able to stop the foreclosure, but he can probably sue the pants off of the people he had the contract to purchase with. Do you know if he has a contract to deed? Does he have the property classified as his homestead on the county tax rolls? These things might make a big difference.

Afterthought: If all else fails have him get the lawyer to contact the financial institution directly. They might be willing to work a deal out so that he can keep the house and deal with them directly in the future.

edit on 4-9-2012 by littled16 because: (no reason given)

posted on Sep, 4 2012 @ 03:00 PM
reply to post by EvilSadamClone

Tell him to get a lawyer ASAP.
But more than likely he's screwed.
At least a lawyer can try to make a deal in court.

posted on Sep, 4 2012 @ 03:30 PM
One of two things happened: Your friend didn't read the fine print in the contract, or your friends landlord is in breach of contract. I can't see an RTO contract NOT stipulating that the current owner pay the bank monies towards ownership for the tenant. As the others said, get a lawyer. Today if possible. If the landlord is in breach of contract, the lawyer will see that and have the bank hold off on the foreclosure proceedings until the case is settled.

There's only 45 states listed here, hopefully one is yours, that list the RTO statutes for each state. If your state isn't on here, go to the Government website for your state and find the landlord/tenant statutes. Every state has them. Have your friend look over his contract, look over the statues for his state and see if he has a case. If there is nothing in the contract stating that the current owner HAS to pay the bank, your friend is SOL and needs to read the fine print in his contracts more carefully next time.

Good luck.

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