Legal Question in Real Estate Law in Indiana

I am interested in buying a house from a couple who bought house on contract. They are 5 months in default. The house has not been forclosed on yet and the owner has changed locks on them after breaking out a window. They bought house in May 2005 for $165,000 put $10,000 down and paid $1150 per month at 7.1%. Last year the house burnt down and a completely new house was built. They house is worth more than owed, and the couple wants to sell to me for the amount owed which is $147,000 to get out of the debt.That amount is not including late charges/interest. Remember this has not been to court and owner has not filed forclosure yet. The owner will sell to me, but wants more for the house than originaly paid for. He is asking $170,000-$175,000. I told him that he cant ask for more than is owed on house. He says that the couple owe approx $23,000 in late charges, penalties and interest. He has another buyer who he has told a price of $225,000. Can he profit from this new house by asking more for it than is owed and if he does doesnt he owe the couple the difference? I only want to pay what is owed because the house needs new carpet, paint, holes fixed and appliances. The charges of $23,000 is unrealistic. Can he ask $170,000-$175,000?


Asked on 2/23/11, 8:17 am

1 Answer from Attorneys
Jay Rigdon Rockhill Pinnick LLP

He can ask whatever he wants. The current purchasers should get a payoff figure from him, and if he won't give one, figure it out with the help of an accountant or an attorney. If you then can pay that figure to the landowner, with a written deal from the purchasers, you can probably get it bought. You will have to pay in full of course. See an attorney to help with the proper paperwork; do NOT try to finesse this situation without professional assistance.

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Answered on 2/23/11, 8:28 am


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