Serious problems with first triplex deal, need some advice

14 Replies


This is fairly complicated and I'm going to assume most replies will tell me to get an attorney, but I guess we'll see :-)

I am located in NH, I went under contract in April of this year on a $180k triplex, it is two 3 bedrooms and a 2 bedroom. all 3 units collect WELL below market rent at only $160/week. each unit has its own washer & dryer hooks ups, each unit has TONS of extra storage and the 3 bedrooms each have a garage bay all for the same $160/week. 

Average rent for a 3 bedroom in the area is between 900-1300/month. the units are all in good condition and will be receiving some updates once the sale goes through, if it goes through, it will be a cash flowing property even as an owner occupant or at the very very least I'll live for free and have extra money to put away for any issues that may come up. The seller agreed to our P&S price is $174200 with $9200 in seller concessions for closing costs/escrow. the home inspection found some issues, so we amended the P&S and the seller agreed to every single one of them and remedied all of the repairs with professional contractors which included replacing basement stairs, rebuilding the top of the chimney, replacing one of the furnaces and one of the water heaters, among a few other minor repairs. this was all fantastic and im very happy that the seller agreed to EVERYTHING!!!!

But here's where the problem comes in. I am a single dad and will be an owner occupant, so my daughter and I only need a 2 bedroom, from day one the seller agreed to evict the tenant from the 2 bedroom unit as part of the deal, as this tenant had already been violating the lease by subletting to heroin addicts, multiple domestic violence police calls, late rent payments etc, and the other two tenants have been there for a very long time one for 12 years and the other for 20 years. A sheriff removed the tenant on the 17th of april, but then the tenant contacted some legal aid company who filed an appeal with the NH supreme court on his behalf stating he was a veteran(he is not a veteran). its now going on 3 months since the district judge granted the eviction, our close date has been rescheduled NUMEROUS times, and it's costing me thousands of dollars every month that I am not closing. The Supreme court in NH is not going to get to hearing or scheduling this case until around September. 

The seller and her agents(husband and wife team) have withheld this supreme court appeal information from my agent and I and have tried to bribe us to close many times saying "we'll put some extra money in escrow in case there's any problems with the tenant after you close" I have refused to close on this property until the seller abides by the terms. I want a final walk through and I want the building in the agreed upon condition with the 2 bedroom unit vacated and move in ready. If I close and this tenant doesnt get out and I dont move in within 30 days, I'm sure the bank will call the loan or try to take some legal action because I am using an FHA loan as an owner occupant and must move in within 30 days, it could be months before this tenant gets out.

The sellers agent threatened to put the house back on the market if we didn't get back under contract within a a couple days, but its the seller and their agent that are breaking/breaching the contract, they are withholding information and trying to bribe me to take action, to sneakily get me to close. They have offered to compensate me out of contract, because they "want the numbers to stay where they are" 

someone I know, knows the tenant which i didnt know until recently, they are the one who informed my agent and I of the appeal and the lack of military service, she showed me the court documents that the seller and her agents have still not shown us, The person i know that knows the tenant said he HAS NOT been staying in the apartment in fear that the courts are going to find out hes not a veteran and have the sheriffs come arrest him as the court is paying the tenants weekly rent because he's an unemployed scum bag who lied about being a military veteran, She's also told me that he has signed a new apartment lease somewhere else and she has offered to and has started helping him move his stuff out of the apartment.

I forced my agent to get back under contract yet again, she made the close date for tomorrow Friday the 13th of all days, the guy still isnt out of the apartment fully(meaning all his stuff) there are still random people answering the door who are not on the lease who are missing teeth left right and center. still no walk through. yet, everyone still expects me to close tomorrow, I'm telling my agent, NO 

let me guess, contact an attorney? HAHAHA please help?



If someone is trying that hard to get rid of a property, you have to ask why. Maybe this is a blessing in disguise and you should just run. Seller has not met contingencies, and is being deceptive.

well heres the back story, the seller and her husband had the house on the market for about half a year, because the husband was diagnosed with brain cancer, they wanted to sell the house before he died so the wife and kids didnt have the burden, well he died last month, so the seller is a grieving widow, and having to deal with a scum bag tenant who prolonged the house sale long enough for him to pass before it could complete. The husband was so very thankful that I was a respectful hard working single dad and didnt want to evict his long term tenants they were so happy to sell this house to me, and the other tenants were so worried that some investor was going to come in and buy the house and clear it out, they were very thankful that I was deciding to purchase it as well. I truly think that maybe the seller with held the information from her agents because she was scared I would back out of the deal she just got stupid while grieving for her very recently passed husband. 

I just dont know what to do, I HAVE to move out of my current residence ASAMFP!!! because I rent a townhouse from my mother and she is selling it. I no longer have the time to find another property It is either this property or I go back to renting for now.  IF the information I have is correct, the tenant could be out as early as tomorrow, or as late as september. I am so stressed out right now I feel like my brain is going to explode. My daughter and I have been living in limbo since april, this our life now, on hold, in limbo, stressed and pissed beyond all recognition

Take the side money they offered and close the deal. Even if it takes you a few months to occupy, you were compensated accordingly. You don't need to immediately occupy for FHA.

I'm super new to all this so I really feel like I shouldn't even post (if fact, this is my first post). Therefore, forgive me if my post is ignorant.

However, could you offer the tenant a few hundred bucks to stop playing games and get out? 

@Jeremy G. As a licensed mortgage loan originator in CA, I can tell you that per the note, you do need to occupy the property within 30 days. That said, for the lender or an FHA rep to physically come to the house and check is very highly unlikely and the only time I've seen it happen was because there was fraud involved; I wouldn't worry too much.

In terms of the tenant, it sounds like he's just an unproductive member of society.  In my experience through my own dealings and those of people in my circles in dealing with folks like this, James hit it on the head in his post above; cash is king. 

If you have a friend that knows the tenant, talk to him (the tenant).  Find out what the dollar amount is that would get him and his buddies to hit the road for good.  Whatever that dollar amount is, negotiate it as low as possible, make him sign an agreement and don't pay until all his crap is out then see if the sellers will help pay it.  At that point you will know what it takes to close the deal and then you decide if its still worth it.

Again, just my personal opinion, but sometimes the direct path is quicker and easier than the judicial one.  Good luck!    

Your situation is not as bad as you think. It's not like you're renting from someone who has a new lease tenant moving in on the first of August. So what you have to rent for another month or two? Take the time and find the right property with the right realtor and seller and tenants. Have your mother sign a six month lease with you so you are protected if she sells. Include a clause that with 30 days notice tenant may terminate the lease with no penalty. Worst case scenario, should you decide to continue with this deal, you put your things in storage and stay in a hotel until closing.

The current owner probably has to evict the tenant through the courts, and that could take a long time. If you were in Chicago, could take as long as a year. It's ok to back out of the deal if it's falling apart and the seller is not meeting the contingencies.

I had a situation where I was supposed to close on a Friday. Friday morning I learned that the loan was denied because the condo HOA had too many units delinquent. I went out Saturday and put an offer on another condo. I had been looking the whole time just in case. In my situation I HAVE to move because someone has signed a lease on my current apartment. Closing isn't until August 2. So I will be doing the storage/hotel thing for a few days.

HOPEFULLY, the current tenant in the condo I'm buying will be out by August 2 without any issues. Otherwise I will be in a situation myself. I'm pushing to move closing to the end of July and pay them to be out by the last week of July. It is very stressful, so I feel your pain, but you have options.

There is no fraud, and they won’t call your loan, if you are making a good faith effort to occupy the unit.....these things happen as fha is aware. I would close and deal with the tenant face to face. As you’ve said, he’s already found a new place and has fears of being caught in the false vet claim. Make him understand he is on the hook for getting these other people out, those could be your biggest problem.

thank you for all the replies!

So, to clear up a couple of things, my mortgage broker said with the FHA loan i am getting i have 60 days to occupy the unit so I was wrong about the 30 days according to my mortgage broker.

The seller as informed me that she will pay whatever it takes to get the tenant out but she cant do it her self because of the pending litigation, My agent has physically gone to the property and tried to get a hold of him but he is avoiding everyone like the plague, he has his friends call people back and act like him and feeds everyone a bunch of lies.. so it seems impossible to actually get a hold of this guy and offer him cash. 

one of the problems with me remaining in my current residence is my mother needs to renovate the place, with new floors, windows paint etc and refuses to do it while anyone is living here, she is desperate to sell and we all expected me to be out months ago, had I known 4 months ago about the supreme court appeal I would have backed out and found another property, I am just in to deep and too late to back out, this property is mine I will close on this property by any means necessary. 

The seller has agreed to compensate me in many ways, she has offered to pay me cash out of contract for my patience and for not backing out, she has offered to put money in escrow and she has also offered to pay rent for me to stay somewhere until we close and the tenant is out and i can finally move in and at this point I am ready to take that deal. BUT!!!! it could literally be many MONTHS before this guys is actually out, and if so that will bring me past the 60 days that I have to move in with my loan. 

Even though he broke the law by claiming he's a vet to the court and im sure they will arrest him and dismiss his case once they find out, Who knows how long that is going to take, and I cant be living in a hotel with my 8 year old for however many months it's going to take and if we just agree out of contract for certain types of compensation who knows if the seller will actually keep her word and pay up especially if its not exactly legal to make dealings for cash and compensation outside of the real estate contract, that is where my agent and I just are not sure if it is even legal to make deals like this outside of the contract my agent is fairly new but she is very trustworthy and she is working her butt off and doing everything she can to get this taken care of, she's confident she can get me all the rent from our first close date till the time we close, and she also thinks she can get me at a minimum of $5,000 cash out of contract, I'm already getting a refund of $1100 at closing, so if we can close this deal and the seller is willing to pay up, Ill actually walk away from closing with zero money out of pocket and a wad of cash and a 180k income property.

My agent and I want to do everything in a legal way to cover our *** and we want to make sure the seller can't back out of any agreements she makes.

Thank you all so much, im stressing real hard right now and my anger is starting to come out in ways I don't want it to. LE SIGH

@Dennis M. yes NH is expensive the average house price in the area I am purchasing is around the 200k for single families and right at 180k for multi families, if i go to more populated areas, multi families can get upwards of 200k-300k+ not to mention electricity in NH is astronomincal.

It's hard to find a cash flowing property around here because most people want all the money for everything they list.