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REAL ESTATE CONTRACT & DIVORCE -- *need help * Comments Welcome

Discussion in 'Other Off Topic Forum' started by Hubert888, Mar 4, 2004.

  1. Hubert888

    Hubert888 F1 Veteran
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    One of my friends is in a predicament. Advice would be appreciated. Here is the story:

    Six months ago, he and his wife agreed to purchase a condo apartment in New York. A purchase agreement was signed by both husband and wife for the apartment. A 20% downpayment was required at signing of the purchase agreement so 10% was paid by the husband (using his own personal pre-marital funds) and the other 10% was paid by the wife's parents. That way the husband and wife would each have 50% ownership of the unit.

    Now, the husband and wife are getting a divorce. The wife's parents want out of the deal now. By the way, the apartment unit has NOT been built and finished yet so there has not been an official "closing" of the deal yet. It's a new construction building.

    My question is... if the husband writes a check back to the wife's parents for the 10% downpayment they put down earlier to get his in-laws out of the deal, would that automatically mean that the wife's name must be wiped off the purchase agreement also? If no, what percent ownership of the apartment does the wife have to claim during divorce settelements? The marriage was only for a year with half a year separation already.

    Would it be better if the 10% downpayment was returned back in the wife's name and instead of the parent's? Is that even possible?
     
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  3. tifosi

    tifosi F1 Veteran
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    not a legal expert and nothing should be done with the divorce lawyer but as long a the wife's name is on the contract she is part of it. Nothing can be changed without getting her name off the contract
     
  4. tifosi69

    tifosi69 Formula 3

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    What he needs to do is: decide if he wants to stay in the deal at all first off; if this is an agreement to purchase real estate, depending upon the special stips of the agreement, I'm sure it was contingent upon obtaining financing OR was it a construction loan? Can you clarify?
     
  5. kevfla

    kevfla Formula 3

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    Although I am not a lawyer, most standardized real-estate contracts typically used by Realtors have a financing clause that states in effect that if financing is not obtained despite due dilligence, the escrow deposit is returned to the prospective buyers. I would think that if both husband & wife's incomes were needed to quality for the loan and one party drops out (i.e. wife's), financing could not be obtained and deposits are returned. At least in Florida. Your state may vary in that regard. I am a licensed real-estaste salesman and state-certified residential appraiser.
     
  6. tifosi69

    tifosi69 Formula 3

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    Absolutely correct, unless, and the post is a little unclear, they entered into a contruction-to-perm loan and the building is not yet complete, which would explain his statement regarding it "not closing" yet; the permanent loan has not closed yet, but the construction loan has, which means they are both still on the hook. We need further clarification.
     
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  8. Hubert888

    Hubert888 F1 Veteran
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    The purchase agreement states that you are responsible for the purchase price monies at closing and it is non-mortgage contigent deal.

    Purchase agreement also states that buyer is entitled to one name change on the purchase agreement before closing, if needed. So yes my friend would be able, if wife agreed too, to get his wife's name off the contract.

    The thing that is making this a bit more complicated is that my friend (the husband) wants to end up living in the unit with or without his wife's parents in the deal or not. So he still wants to pursue the deal.

    As far as what I wrote earlier as the deal isnt "closed yet" means that closing for the unit is supposed to be in June....meaning that the mortgage is signed that day, all other cash has to be put down, etc.... and buyers have legal right to occupy the unit and call it their own property.

    If buyers fail to close in June on that date, buyers will forfeit all down payment monies due to default of the purchase agreement contract they signed earlier.
     
  9. tifosi69

    tifosi69 Formula 3

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    OK, if he wants to live there then he needs to pay them off and have the wife or the parents, whomever was a signer on the purchase contract, sign a quit-claim deed. As far as marital assets I am no divorce attorney, I assume that is specific to your state.
     
  10. whart

    whart F1 Veteran
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    Your friend needs a matrimonial lawyer. Assuming he wants to go forward with the real estate deal on his own, i wouldn't be in a big hurry to write out checks to the soon to be ex-wife's parents until a binding understanding, that is subject to court-ordering, is reached, relieving her of the obligation to come up with the other 50% of the purchase price in exchange for his right to sole ownership and his agreement to reimburse her (or her parents) the 10% downpayment. Otherwise, he could reimburse her ( or her parents) and still get into a fight with the soon to be ex over her entitlements to an apartment that was acquired during the marriage. But, get a good lawyer well versed in this stuff. I am just a humble copyright lawyer, and whenever i get divorced, i hire somebody else to do the knee-capping....
     
  11. tifosi69

    tifosi69 Formula 3

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    That's some funny sh*t
     
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  13. Texas Forever

    Texas Forever Four Time F1 World Champ
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    It never ceases to amaze me how many people think that watching a few espisodes of Law & Order makes them a legal expert.

    Folks, I used to do expert witness work for divorce attorneys. My stock advice for anybody in the unfortunate situation where you are facing a divorce is to find the smartest, meanest, best connected junk, yard dog you can find and then listen to what he or she says. Do not listen to your friends. Do not listen to your neighbor. Don't even listen to your momma. Just pay the man and do what he says.

    This is no place for amateurs, DrTax


     
  14. Doody

    Doody F1 Veteran

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    when i grow up, i want to be you, dude!

    LMFAO.

    :)

    doody.
     
  15. tifosi69

    tifosi69 Formula 3

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    I was just speaking from my real estate contract experience, not from any legal experience.
     
  16. SrfCity

    SrfCity F1 Veteran

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    I think that her parents would be glad to get the $$ back if faced with losing the deposit. Your friend is in the drivers seat imo because he can decide to forfeit the deal if he wants and they'd be out the $$. If he decides to buy them out, he is going to have to make sure that any check that he cuts to the parents will indemnify him of any future obligation. If he can buy out the parents at what they have into it, then he's getting a hell of a deal. Already the place must have appreciated substantially. I think that this could be handled ammicably if all parties are in agreement. Why pay those blood sucking attorneys if everyone just wishes to go their own separate ways.
     
  17. whart

    whart F1 Veteran
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    What's that joke about the difference between a tornado and a bad marriage? Something about getting blown before you lose the house?
    srf City: Dude:
    Just hire a lawyer, bloodsuckers or not.
    I have no love for lawyers, having to be around them all the time. But i'm constantly amazed at people who can just walk into a situation and say, "yea, its just a carb rebuild, or a simple aorta cleaning. **** the mechanic/doctor, i know enough, i'll do it myself."

    I'll never forget leaving a hearing one day a few years ago, after the defendant appeared on his own behalf. The court had just entered a temporary restraining order against him, and ordered him to appear for depositions and show cause a few weeks later why a preliminary injunction should not be entered. As this genius left the courtroom (and he had a rooting section made up of hackers and lowlife silicon valley types), he said to the group on his "side" : "Gee, that wasn't so bad." One of the hackers turned to him and said: "Buddy, you should probably be paying a proctologist to pull your head out of your ass, rather than a lawyer." The hacker just shook his head and walked away.

    Paying the parents has nothing to do with relieving the husband of his obligations, or eliminating his wife's entitlements to marital property. Of course, if everybody could just amicably agree and sign where indicated, chances are, they wouldn't be in this situation to begin with. But, even assuming they are all happy campers, i would think in most states, anything short of a court order will not mean much if she changes her mind on the allocation of property issue. But, as a lawyer, i'm not sure, since this is not my area of specialization. As i said, if i need legal help in an area outside my own, i am not stupid enough to have myself for a client. Of course, a proctologist's rates are pretty high these days too....
     
  18. enzorio2001

    enzorio2001 Rookie

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    Your friend is in a bit of a pickle especially if the divorce is acrimonious (most divorces are). He cannot just pay the parents off. He does need a divorce attorney (agree with whart) and if he wants to live there he must pay off the wife AND get a quit claim deed. Whether he can live there is another question. Did he qualify for a loan based on her income?
     
  19. Hubert888

    Hubert888 F1 Veteran
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    Yes, he can qualify for a mortgage that will cover the entire purchase price of the apartment.

    Her parents are willing to have zero ownership of the condo if they get back their 10% intial deposit. However, they do not want their daughter's name removed from the purchase agreement. So they are being thick skinned buttheads.
     
  20. SrfCity

    SrfCity F1 Veteran

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    Why doesn't he see if he can transfer his share of the deposit and ownership to another unit? The condo people may agree to this considering the predicament.
     
  21. Artherd

    Artherd F1 Veteran

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    Her parents are willing to have zero ownership of the condo if they get back their 10% intial deposit. However, they do not want their daughter's name removed from the purchase agreement.


    Are you kidding me?!

    Allright, get your friend a damn good lawyer NOW.

    Here's my non-legal-advice as to why you might need one. Idle speculation below:

    Your friend needs to tell the parents to go to hell. Get the condo, retain 50% of it, and when she defaults on her share of the monthly because daddy isn't backing her up, sue her for the remainder. Settle for her 50% share, plus outstanding monthlys to that point, then protest the credit marks (if any) away.

    He gets in for 10% down, parent's (really the daughter, regardless of where she got the money, it is HER name on the contract!) forfit theirs (sound like a-holes anyway), and he owns the place outright.

    This works as long as the marriage issue (and whatever your state's community property laws say.) is ignored, and a bunch of other groose assumptions on my non-lawyer part.

    I know dick about divorce law. Consult someone who does.

    Tell your friend to watch his cornhole.
     
  22. Korr

    Korr F1 World Champ
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    This is sage advice!
     
  23. DrStranglove

    DrStranglove FChat Assassin
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    So, they want there money back but their daughter to have ownership of the unit?

    Yes, this is BULLSHlTSKI.

    To DrTax you listen!!!!

    Also, though, not in your description is, how much does your friend want to screw with her???

    DrS
     
  24. Hubert888

    Hubert888 F1 Veteran
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    See the whole problem is this:

    If the wife does not come up with her 50% of the cash at closing, and the husband doesnt cover her ass on her 50% due, then the property is forfeited back to the sponsor of the building. All 20% of the downpayment is lost.

    I do not think the husband wants to lose his 10% downpayment just because his wife defaults on her part. And if the husband does decide to mortgage 80% of the unit (20% is already paid for in cash) because he doesnt want to lose his downpayment he already paid, does that mean still that the wife has ownership of the unit even if she defaulted in her 50% at closing?

    Also, what if the divorce isnt finalized before the closing. Does that have more of an impact on this situation? I will tell my friend to consult a lawyer to see his options. WIll keep u posted.
     
  25. benedict

    benedict Formula Junior

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    I agree with the other posters to get competent legal counsel. It' s been my personal experience (and I am an attorney) that judges have very little patience for pro se (legal term for representing yourself) litigants. They barely have patience for attorneys (LOL). They just get frustrated having to spoon feed them. I have a matter right now where the Judge just completely dismissed the pro se litigants entire case because he got tired of asking them to comply with deadlines, why didn't you bring the transcripts, why didn't you pay the filing fee, stop showing up late, stop interrupting etc. AAAGHH DISMISSED!
    Furthermore, I have a friend who is in a nasty divorce and custody battle.
    He and his wife "agreed" that neither would hire an attorney but lo and behold, she shows up at the hearing with an attorney. He stands there stammering with his finger up his ass, getting crucified. Now he can't even see his kid without court supervision!
     
  26. tifosi69

    tifosi69 Formula 3

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    Again, for DR TAX, I am not speaking from a legal background, merely a real estate background, but in Georgia I have seen similar situations. Basically, IF they are going to divorce for sure I guess he could have the parents/wife sign a quit claim deed and then roll the rebate of downpayment into part of a divorce settlement I GUESS. I have seen this happen. If the husband can secure the financing for the 80% on his own then the quit claim will relinquish the wife's claim or interest to the property in so far as marital property in a divorce. Now, again I am NOT AN ATTORNEY (but I did like LA Law) but the wife/parents could always refuse to sign the quit claim, in which case then he has a mess on his hands, which is beyond my purvue of knowledge. I have also seen that happen. Then it's time to go Johnny Cochran on her ass.
     
  27. tifosi69

    tifosi69 Formula 3

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    I have some friends of ours that can make his problem .. shall we say..disappear.
     
  28. bobafett

    bobafett F1 Veteran

    Sep 28, 2002
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    Hey, I could use some of those aforementioned services, since Doody has yet to expand on his region of services performed! :D

    --Dan
     

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