Kind of in a weird predicament here. We entered into an agreement to purchase a few buildings from a seller. The seller was very slow in returning docs and filings. The attorney did send e-mails, but all the docs were obtained by RE agent. Upon reviewing all the financials and the "new" rent rolls, they were drastically overstated. The units were described as 2 and 3 bedroom units (even in the contract), the "new" rent rolls which were signed off stated 1 bedrooms and a few studios. We gave the attorney 2.5k in a deposit and he actually invoiced us another 1.5k in "fees". He didn't write the contract, it was the sellers. He didn't do any of the negotiations, it was done by the REA. I requested some considerations, he declined them and thought he was being generous in "only" invoicing me an additional 1.5k.
What do I do here? Never been in this predicament. I've had deals fall through, and usually the attorney works with us on the fees. However, this one wouldn't do jack.
@Calvin T. Hard to know what to say without knowing what you agreed to with the attorney.
He might be completely justified - or not.
As to the seller, you need an attorney (maybe a different attorney if you're unhappy with the one you have!) to help you to understand what your options are. There's obvious misrepresentation, so the contract should at least be voidable.
There may be particular legal steps you need to execute in order to get EMD and deposits returned - the attorney should advise you.
No deposit was issued as we had to run after the seller to deliver a signed and correct rent roll. When we received it, it was completely different that the one in the contract as well as on the MLS.
You should be able to figure everything out during your due diligence period in terms of unit sizes and rent amounts. Ask to see the sellers tax returns.
I'm assuming the seller self manages and has poor records of rent numbers? If so you may have to go door to door and ask the tenants.
During the inspection and appraisal the unit sizes will be reported.
Keep in mind that any lies or misleading crap that the seller tries to do can be used as a negotiation chip.
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing