Real Estate Deal gone bad... elderly seller shakedown?

[GLyford]

This is a flipper scam. Get everyone to agree to a deal at fair market value, and at the last minute downgrade your bid, with or without reason, by the desired profit margin, then reflip again for market value. They do this a lot and have realtors and legal willing to work with them for a cut. A coworker just saw this with his house. Told them to pound sand and they went away.

Edited to add: This is a younger family, not elderly, so these scammers are not biased and will try to cheat anyone with a house for sale.

 

[GLyford]

They hold the threat of "losing the deal" over them, but basically, there is no real reason to force the sale at the worse terms.

 

[ultrarunner]

The owners really have no time frame for a sale... they have owned the property over 50 years and long ago paid for it in full.

Appreciate the comments.

It did strike me as strange they came in high contingent of seller financing and from the moment the offer was accepted came up with problem after problem... of course this was well within the 10 day review period...

Just learned they also "Plan" to file a complaint against the agent/broker... both have 30 years+ complaint free.

 

[hawkeye08]

Maybe a scam or maybe just the way the buyer does business.

 

[Midniteoyl]

Wait.. The seller not only has records showing the stats of the property, has a clean title, AND sold this property 'As-Is', but has also already agreed to releasing buyers? Did I get that correct? If so, how in the world do the buyers think they can do this and actually win? Have the seller tell the buyer to pack sand. If it ends up in court, which is highly doubtful, then have the seller counter-sue for costs of legal fees.. I doubt any judge would rule in the buyers favor.

 

[ultrarunner]

^^^

This is exactly the scenario... in what world would this not be the case and what part of As-Is does a foreign buyer not understand???

Don't forget the sellers agreed to carry the First Deed of Trust which even scares me more... it is like being married with every month continuing the relationship.

 

[CCWKen]

I'm not an attorney and don't play one on TV but I don't think Real Property can be sold "as is". The seller must disclose all known deficiencies that would affect the value of the property. That means a signed disclosure at the time of the negotiations or an inspection report. It does sound like a scam and your friends aren't being sued until they receive service. $5000 is not worth going to trial over since an attorney would probably cost that much or more. They may try to take it to Small Claims Court though but your friends would probably have an advantage there. SCCs generally don't allow attorneys and the judge can rule on the case. The burden of proof is more relaxed. Did the potential buyers view and inspect the property? Was an offer tendered and accepted? I'd tell them to pound salt until I received service on the suit. It's just a way for the buyers to tie up the property until a settlement can be reached. The best thing your friends can do is file suit first in SCC and serve THEM with the suit. Then offer a waiver for them to sign and withdraw the sale and suit. It's not that hard to show fraud and attempted theft from the elderly. Judges love to rip people for that.

 

[ultrarunner]

You are correct... California is a disclosure state unless it is probate.

Husband is battling cancer with Chemo and wife has Dementia... she forgets even owning the property.

It was listed As-Is with a specific California Association of Realtors As-Is addendum signed by the seller and buyer.

Buyers ordered reports... I don't know how many... I think termite and structural... the building is old and the value was "Thought" to be in the land. Seller furnished Title report and a certified copy of Tax Collector Records...

Buyers went to the city and the city can't find any record of construction... only a single permit for sewer lateral replacement 15 years ago...

When the last tenant vacated about 3 years ago the owners said it was just too much dealing with tenants and decided not to keep it vacant... used one unit for storage of business records.

The bathrooms still have clawfoot tubs the toilets tanks mounted to the wall stamped 1922... water heaters are in the kitchens... real 1920's style throughout... single pane double hung windows and gas floor furnaces with a keys...

When buyer said the city has no record I was asked to check and found the same with the city...

The county tax collector has extensive records for this property going back to the 1920's... number or units, kitchens, type of construction, finishes, square footage, basement, parking and notes addresses for both units and individual utility meters...

It was news to everyone that city records are incomplete... the property has water, sewer, gas and electric services with two mailboxes.

Buyer claims Seller knew or should have know city records are incomplete.

No way in **** would the buyers know this... they never made any alterations and have owned it since 1960 and bought it from the original owner widow lady... they did have the old clay sewer pipe replaced for about 9k 15 years ago... I remember because there was significant street excavation.

Just unbelievable what dirty tricks some will try...

I wish I could speak their language because I would give them a piece of my mind...

 

[CCWKen]

Perhaps the property was not always within the city's jurisdiction or was un-incorporated. That would explain the lack of city records. I live in the county and any city that would expand and take jurisdiction over permits and ordnances would show nothing for this property unless they got it from the county records. I can do pretty much anything I want here as long as it meets state permits and laws. This property was nothing but an over-grown, mesquite and cactus filled patch of land set off by the farmer out back. I built and installed everything on this property including utilities without a single permit. I like it that way.

 

[dickfoster]

They received a demand letter from a lawyer with a copy to the Title Company.

No notice of Lis Pendens that I know.

My friends have a backup offer for a little less from a local contractor... Title Company says now that it has been put on notice it must act accordingly.

I would imagine they could bypass that Title Company and use another.

Never heard of a buyer suing for to be reimburse for due diligence research...

Demand letters are good for starting fires, lining bird cages and such. That is unless you want to send it along to the local bar association.