Owner financed home to buyers now they want money back. Did not go thru lawyer just typed up a contract what can I do?

Asked over 1 year ago - San Benito, TX

Contract signed by all parties and notarized. They fell behind three months and that was agreement...no payment for three months and they in default.

Attorney answers (4)

  1. Robert Neil Newton

    Pro

    Contributor Level 16

    2

    Lawyers agree

    Answered . You really need to hire an attorney. Owner finance deals on residential property are tricky these days. You have the Federal SAFE Act, Texas SAFE Act, and Dodd-Frank with which to contend.

    The above statements are provided as general information and not intended as legal advice. Each matter has its own... more
  2. Adam Nelson Rieck

    Contributor Level 10

    1

    Lawyer agrees

    Answered . This is going to be difficult to discuss without more transaction specific details. I think it would be a good idea to have a real estate lawyer in your area take a look at what you did with the contract you made up. You should be careful here, there are certain types of "owner financed" type real estate transactions that, if created (which can happen unintentionally) in Texas, can very risky for the seller due to statutory penalties associated with failure to perform certain duties within the transaction. You always have to be aware that If your buyers are pushed into a corner, they may push back... if you've got an exposure it can go sideways quickly. Get some solid advice before proceeding.

    The above comments are made by an attorney at The Rieck Law Firm (RLF). RLF offers free initial consultation to... more
  3. Kevin Matthew Koel

    Contributor Level 16

    1

    Lawyer agrees

    Answered . The other attorneys are correct, it is more difficult than ever to have an owner financed transaction without involving a residential mortgage loan originator and a title company. The penalties for not doing the transaction right are almost always borne unto the sellers in the transaction. You will need to go see a real estate attorney to review your documents and determine your rights.

    If this response was helpful, please mark it as helpful or as a best answer. The response provided herein is for... more
  4. Michael T Millar

    Pro

    Contributor Level 19

    Answered . What you can do will be dictated by what the contract states.

    If it is a mortgage, you may foreclose.

    If it is not a mortgage, then you would have to sue for breach of contract.

    I am not a TX attorney, laws vary from state to state, therefore you should always consult a local attorney.

    If this answer was helpful, please mark it as helpful or as a best answer. This answer is for general education... more

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