Posted by David Alexander on June 28, 2001 at 15:41:23:
that ya’ll call it non refundable deposit ro earnest monies…
I don’t, I give them an option to purchase with an expiration date… and then call it Non-Refundable Option Money to clarify… if they dont excercise they dont buy… simple and clean.
Where there may be grey areas for deposits and earnest monies there are not for options.
David Alexander
Bronchick? William? Jim, IL? - Posted by Terry (Houston)
Posted by Terry (Houston) on June 27, 2001 at 19:52:09:
Well I get to go through what yall did.
Had a person sign one of Bill’s Lease Option Receipt Agreement.
He put down $2,000 Non-Refundable Option Consideration.
He then proceeded to put me off past the June 1st deadline to move in to the house as well as the deadline for the remainder of the money and 1st month rent due. This was some $3,000.
The Preacher informed me that his wife was in the hospital with a heart attack but that the deal was still on.
Then the flood came and his car was wiped out. Again though, the deal was still on.
Last week the good preacher met me at the house, under the premise to give me the money, but instead informed me that he would not be able to come up with any money until the 29th. A full month past his due date.
Well I put the house back in the paper as a contingency in the event he backed out of the deal.
Somewhere over the weekend he called me to inform me that he saw the ad in the paper. He said “Well I can’t come up with the money to get in so the deal is off.”
Today he called me to ask when he could come and pick up the money. I asked him to please read the agreement again and he said “All deposit money is refundable.”
When I informed him no this was clearly not the case he said I would hear from his lawyer.
OH JOY!!
Anyway, hope I have as good a luck as yall did.
Document
Document
Document
Terry
Re: Bronchick? William? Jim, IL? - Posted by Bronchick
Posted by Bronchick on June 28, 2001 at 17:21:45:
The last time someone tried to get their money back on one of these deals (using my contract), the Judge said to the would-be-tenant-buyer, “What part of non-refundable don’t you understand?”
Re: Bronchick? William? Jim, IL? - Posted by eric-fl
Posted by eric-fl on June 28, 2001 at 13:07:39:
First of all, as of right now this is a non-issue. All you have is a verbal threat that a lawyer might call. I would disregard it and move on. IF, and it’s a mighty big if, a lawyer calls you, the most sensible thing to do is refer him to your attorney. Don’t discuss anything other than your lawyer’s contact information. Anything else you say is being recorded, and will be used against you in any way possible.
IF it goes as far as lawyers talking, your best strategy is to simply have your lawyer state that you are merely enforcing that which is clearly written in your documents. Tell your lawyer to strongly advise their lawyer to review said documents before taking matters any further, as they are clear in their provisions. Your overall goal is to make them go away, with as little effort and expense on your part as possible. After all, you are holding both the cash, and the keys to the house. Possession is 9/10 of the law. If they want either one, the burden of proof in civil law is on the Plaintiff, i.e., not you.
Also remember, it is highly doubtful this person has the resources to retain an attorney, let alone a lawsuit. There’s only two ways to pay a lawyer - cash or contingency. IF your buyer can get an attorney silly enough to go the contingency route, you can be 99% assured that it will never go beyond a phone call. This is because lawyers who take cases on a contingency basis are playing a numbers game, and they know it. Unless they have an airtight case, they never go to court. In fact, they even have a standard amount of damages they typically seek in a contingency case. Right now, it’s around $2500. I’m basically parroting, at this point, inside information that was told to me by a non-practicing (by his own choice) lawyer, just the other day. It was an insightful conversation into how the legal business really works. And yes, it is just a business to them, just like any other.
Finally, if by some weird freak of the universe, a suit does get filed against you, my personal strategy would be an immediate countersuit. Of course you don’t have to pursue it, but it can be powerful incentive for everyone to walk away. Just make sure to do everything through your attorney so as not to run afoul of extortion laws.
Obviously, I’m not as much of a “people person” as Matt. I don’t disagree with him, but my personal view is, if someone wants my money, (and it is YOUR money), then they are going to have to come and take it. I’ve been threatened with lawyers and lawsuits numerous times, as I’m sure everyone has, and nothing has ever come of it. Though, for the day when it does, and it will, I know, I will be prepared to the hilt. It reminds me of a saying, “prepare for the worst, hope for the best, and take what comes.”
Re: Bronchick? William? Jim, IL? - Posted by Matt B
Posted by Matt B on June 28, 2001 at 10:46:25:
Maybe I just don’t like a fight, but I had a similar situation just recently that I handled a little differently. I had someone who put up a $3,000 option deposit for a property that I was going to lease option to him. Everything seemed to be going OK until he called me up and told me that he was “uncomfortable” with my partner. He wanted to get out of the deal and wanted his money back.
Now of course, I had taken the house off the market at this point. We had written up all the paperwork and “EARNEST MONEY IS NON-REFUNDABLE” was very clear on the agreement. The tenant/buyer had even initialed it! However, I always have a ton of buyers for my properties, and in spite of having the paperwork all done and airtight, I told him that I would allow him to get out of the contract and would refund his deposit on the spot.
Maybe I’m too easy with people. I simply prefer to avoid a fight even when I know I stand a good chance of winning. I prefer leaving everyone with a good feeling about me and my business. Now of course, I have run into weasels that require a fight, but I try to handle every bit of my business as calmly and emotionless as possible.
I am in the business of helping people. That is how I approach it. Now of course, I am still tough when it comes to collecting payments from my tenant/buyers and things like that. In fact, I tell every tenant/buyer that their rent is due no later than the 3rd. (This is also in writing of course.) I tell them right up front that if there is going to be a problem with them getting the payment to me, just call me and I’ll work with them. I impress on them that I am the easiest guy in the world to deal with IF they call me AND tell me the truth. However, if they either don’t call me or lie to me, that eviction notice is on their door the next day.
I am certainly not arguing with you on the way you handle your business. I don’t disagree with you at all. I just wanted to add my perspective. Good luck and let us know how it goes.
Re: Bronchick? William? Jim, IL? - Posted by WilliamGA
Posted by WilliamGA on June 27, 2001 at 22:23:21:
Terry,
I always get close to a month’s rent amount from them as a deposit to "hold’ the house while the app is being checked.
When I had my incident a few months ago and was sued, the amount charged as a deposit was brought up by the judge. The judge stated that the form clearly states that the deposit is NONREFUNDABLE and the amount I had charged certainly seemed fair.
I have no doubt that had the amount NOT been fair, I would have had to refund a portion of it.
I think as long as we are realistic in the amounts we are charging, we will never have to worry about being made to repay. After all, we did hold the house off the market and lose money as a result of it.
Bill’s forms are great! No doubt you will prevail.
WilliamGA
Re: Bronchick? William? Jim, IL? - Posted by WilliamGA
Posted by WilliamGA on June 28, 2001 at 18:50:47:
I don’t like to start an argument with folks either. I actually take pride in the fact that I run a respectable business but this lady was WAY out of line. If she had merely been “uneasy” about the deal after a few days, I would have most likely given her money back but to call me and threaten me and state things like “You had better watch your back if you don’t return my money”, well, call me foolish or stubborn or whatever but she certainly didn’t get into my good graces with those type comments.
Re: Bronchick? William? Jim, IL? - Posted by Terry (Houston)
Posted by Terry (Houston) on June 28, 2001 at 12:32:48:
And good advice it is.
IF he had told me on June 1st he could not do it, and if he had not set two appointments to meet me, then not show or call. Then set an appointment, shows up and says wait two more weeks.
If I had not taken the house off the market as of May 9th. My bad for not collecting the names of other buyers then, I know.
Lot of if’s there I know. If not those I would take into consideration a refund (partial?).
But, once again great advice Matt and that is how I would do business, IF…