SCREWED UP! (long) - Posted by ns

Posted by ns on June 16, 2001 at 08:27:43:

Thanks Travis, for the encouragement. That is what a I plan to do, it is just a tall hill to climb. I figure I will have to refi and pay off the little ole lady, and have her hold a second so I can use some of the cash to fix it up. I am heading to my attorneys on monday, to start the wheels turning.
The prop is an 8 plex, north of Louisville KY, built in the 40’s, only 3 units rented at this time… purchase price was $175k, currently owe $156… at one time appraised for $180 but wont come real close as is.
There is definate money to be made, when it is all said and done, it is just going to be BIG JOB!
thanks again.

SCREWED UP! (long) - Posted by ns

Posted by ns on June 16, 2001 at 06:36:48:

Ok, I screwed up. Not the first time, and wont be the last… here is the situation. I had a rehab apt building for sale with very low down payment, and take over payments.
I advertised on the net, and got some decent responses. Then a fella responded that wanted it. I did credit check, everything looked fine. Great guy, he was, until now he has disappeared to another state…and let the utility bills run 3 months behind, and has let pipes bust and flooded 2 apts. Not sure if the taxes were paid last installment and I am in the process of checking that out now.
So, now the place needs 20-30k work… I originally bought it on contract from a little ole lady who lives in Missouri, and I hate to give it back to her in the shape it is in. She agreed to assign my contract to him as well, but it was with the option that I could take it back if I wanted. What should I do? How do I go about taking possession back, if I cant find him???
Thanks for your help… my wife does not want me to take the property back, but morals and future profit say I should give it another try.
thanks for your help!
ps: anyone want to buy an apt building?

Re: SCREWED UP! (long) - Posted by SteveS(CPA)

Posted by SteveS(CPA) on June 16, 2001 at 17:33:32:

NS,

I guess I shouldn’t be commenting without seeing the actual contract. But in most states (well, all states) there is a process you have to go through before you can take possession of a property. And that process could takes weeks or months.

From reading your post it seems the buyer is only late in his utilities and taxes, not on the mortgage and unless it was in your contract that he had to keep those current or be considered in default it may be extremely difficult for you to re-take possession of the property.

Bottom line is if he is current on his note, then he can let the property flood with water up to the roof if he wants. Unless you have something in his contract stating he has to stay current on everything.

But yes do get an attorney as quickly as possible. And I would also find out where this guy is. If he let you run a credit report. Use a service that finds people and get back in touch with him.

Good luck

Re: SCREWED UP! (long) - Posted by B.L.Renfrow

Posted by B.L.Renfrow on June 16, 2001 at 09:50:26:

It really depends upon the terms of your assignment agreement, and the contract with the “little old lady”. I’d get my attorney involved IMMEDIATELY (like TODAY, if he or she is around on the weekend, or if not, FIRST thing Monday morning).

I’d say you are thinking along the right lines by your desire to protect the original seller and do what’s morally correct here. Good luck with this.

Brian (NY)

Re: SCREWED UP! (long) - Posted by Travis (Dallas)

Posted by Travis (Dallas) on June 16, 2001 at 08:09:55:

Get an attorney quick! Get all the facts about the taxes, etc. With the attorney’s help, first thing is to get control of the rent receipts & keep tenants from moving out. Second is to stop any more property damage.
Do EVERYTHING you can to make sure the little old lady doesn’t get burned. "A good name is rather to be chosen than great riches."
Ask for advice like you are doing. Clear your head of negative problems & start solving the problems. You can do it! Turn it around…You’ll grow and I bet you’ll end up making some money. What City is the Apt. in? What was the purchase price? What is it worth? Occuancy? # of Units? On site mgmt.? Age,etc?
Good luck.
Travis