Legal Question in Real Estate Law in California
Problem with tenant and 1994 option to buy real estate
In 94, we entered into a written rental agreement with tenants with an option to buy within 2 years at $62,000. $650/mo, $100 credit toward repairs/maintenance. Have paid $550. Gave a credit of 10% of rent paid toward purchase. Tenants did not purchase in 2 years. In 98, again attempted to purchase but did not. They have paid an additional $35,000 toward the purchase over the years. They want to finalize the purchase for $62,000 although the property appraises at $110,000. We have agreed to sell for $62,000. The problem, they want 10% of all the rent paid through the years to be deducted from the sales price, making the sale $56,170. They have obtained an attorney who now threatens to sue if we don't agree. We offered to give them half for a sales price of $58,975. They refuse to accept that offer. We feel we are being burned for extending a two-year contract to purchase the house into almost 9 years (at the tenant's request). Do we have ANY recourse? Will we lose if they sue? Are we obligated by law to sell for price agreed upon in 94?
3 Answers from Attorneys
Re: Problem with tenant and 1994 option to buy real estate
You should have the contract reviewed to be sure, but without seeing it, and seeing other correspondence between you and the buyers over the years, changes to contracts and agreements concerning real estate sales must be in writing.
Their wanting to buy the house after nine years rather than two sounds like a modification of the contract, or a completely separate agreement. They'd have to have proof of an agreement to buy the house at what they're asking for, otherwise they'd lose in a lawsuit. Have an attorney review the papers, and if they're bluffing, call their bluff--they stand to lose a very good deal.
Re: Problem with tenant and 1994 option to buy real estate
On the facts as you describe it, it appears you have no obligation to sell at all. You should contact an attorney reasonably close to the property in question and have the written documents reviewed together the rest of the information to be sure.
I don't know where your property is located. If it is in Los Angeles, Orange, San Bernardino, Riverside, Ventura or Santa Barbara County, you may want us to look into the matter further for you.
Re: Problem with tenant and 1994 option to buy real estate
Option contracts must be very precise, and followed to the letter. There are statutory requirements in an option contract that must be met. It could be that the first one was valid, but your later agreements lack the required information.
If the property is in northern California, I would be happy to review the documentation.
Ken Koenen
925-924-0100
Related Questions & Answers
Looking for something else?
10,200 active attorneys ready to answer your legal questions today.
Featured Attorneys
Earn additional revenue and grow your business.
