CA Option Consideration Liability

[Kyle-OH 0]

Okay I do a CA with a homeowner and find a TB. Everything is great and everyone is happy. I walk away with my $3000 Option Consideration and I am out of the deal....

 

 

Scenario #1: The original homeowner loses his job and has to move back in to the house the TB is living in. TB demands the option consideration back because he never really had a chance to buy the house.

 

 

Scenario #2 A tornado rips through the city and the house fly's away. The TB demands option consideration back because he did not have a chance to buy the house.

 

 

Scenario #3 The TB goes to get a loan to fullfill his option but the bank won't give a loan because the house is filled with termites.

 

 

Maybe some of the scenarios are far fetched but you get my point. What Happens? Are you truly out of the deal?

[Jonathan RexfordFL 8]

You can be sued for anything.

 

When you assign the deal it is either going to be a release or not a release.

 

If its challenged in court. You will have to defend yourself. Its just the nature of business.

 

#1 is not your problem

#2 is not your problem

#3 is not your problem

[Jason (AL) 1]

Like Jonathan stated, all 3 scenarios aren't your problems.

Although, I can see the validity in your questions.

 

Scenario #1: The original homeowner loses his job and has to move back in to the house the TB is living in. TB demands the option consideration back because he never really had a chance to buy the house.

The homeowner and you are contractually bound to follow what's stipulated

in your agreements. Once they're signed, he's got little leverage to "change his mind".

Besides, if the homeowner loses his job, how is he going to afford the monthly payments?

 

Scenario #2 A tornado rips through the city and the house fly's away. The TB demands option consideration back because he did not have a chance to buy the house.

This is what insurance if for (homeowners and renters).

Again, they're contractually obligated to fulfill their side of the deal.

Of course, if there's no house, then them coming after you for $ they put down should be the least of their worries.

Do all homeowners demand their down payments from the banks when something like this happens?

No. And neither should they.

 

Scenario #3 The TB goes to get a loan to fullfill his option but the bank won't give a loan because the house is filled with termites.

This is a financing issue.

Unless you put the termites there, you're not at any fault.

If they're going to plunk down $ and plan to purchase in the future, then they should do their homework.

This is one of the advantages with lease options/rent to own...it's a "try before you buy" type program.

What did they lose? A small option consideration fee and a few monthly payments?

They had to live somewhere in the meantime, so they're going to spend this money regardless.

They should be thanking you.

Just think if they purchased this termite-filled house, all cash. If this is a problem, then the T/Bs and move to another house

and let the owners deal with it.

[<Steve> 82]

Also Kyle-

 

You are selling the deal you have made with the owner via an assignment to a buyer or tenant/buyer. You are not selling the house. The house just comes along with the deal. The assigmnemt payment you receive is also consideration for the option to purchase the house, binding (making valid) the agreements for the buyer of your deal.

 

The issues you mention have nothing to do with the sale of the deal and the assignment fee you receive.