My parents inherited my grandmother's 30 year old mobile home. It was in horrible condition due to her owning lots of cats over the years and not maintaining anything. Believe it or not it's located in a very nice 55+ community with strict rules. The lots are owned by the park and everyone pays lot rent.
It was sold for $12,000 to a lady and my parents agreed to take payments for 18 months. The lady put $2,000 down and agreed to pay $555.55 each month for the 18 months. When it was sold it was advertised as a "complete renovation" including roof, A/C, windows, drywall, flooring, cabinets, countertops, ,etc. and the buyer was told that we estimated $30,000+ for the renovation. The mobile home was paid off years ago, but at the time of the sale there was an old lien still on the title from a previous mortgage company that went out of business so part of the contract stated that there would be 120+ days allowed to provide a clear title to the buyer.
Within weeks of closing the deal my parents started receiving complaints and threats of a lawsuit from this lady's daughter because she said the home was in worse shape than they thought. Keep in mind they both looked at the place prior to buying it and offered the right to an inspection. The buyer was late on the very first payment and the daughter continued making complaints (all via text messages) about the condition of the house and also started complainging about not having the title even though the contract stated it would take 120+ days to clear the title. The buyer was notified that she was in violation of the contract and about a month late she mailed the first payment and she included the second payment at the same time. Both payments were short by .55 cents, but my parents didn't notice at the time.
Fast forward another month+ and she's late again and is still complainging about the title, although she's stopped complaining about the condition of the house, she is saying she doesn't trust my parents, blah, blah, blah. She was notified again and told that the 4th payment is due before the clear title is required to be provided to her. She sent the 4th payment late and it was again short by $.55 cents.
My parents have the clear title now, but are wondering how to move forward. This buyer has repeatedly violated the contract and based on her track record it seems she will continue to pay late or not at all. She is technically still behind on payments due to paying $.55 short each month in addition to being late two out of the first three months.
Note: There is no land attached to this deal so it is not a real esate transaction. Also, the mobile home is owned by a trust and my mom is the trustee.
What are my parents options? Can they evict her? Can they do a repossesion? Can they force her to sign a new contract stating she will receive the title after all payments are paid in pull? They are worried if they give her the title she will stop paying and will have the upper hand.
I'd appreciate any help or advice you can offer.
As you stated, this is not a real estate question (so take any real estate-centric advice you may get in these forums with a grain of salt).
Mobile homes (with no land attached) are titled as motor vehicles in the State of Florida, so it's a completely different situation from a real estate transaction with a mortgage lien.
Short of asking an attorney (which would be an excellent idea), you might consider checking with the DMV in the county where it is located to confirm how you should handle the lien and the title work.
In my experience with vehicles, the lender normally holds on to the title of a motor vehicle until the lien is paid off, then they sign the title to clear the lien, and send the title to the buyer when only the lien is paid off.
Thus, you are correct to be concerned that if you send them the title, you may not see another dime and will have very little recourse.
@Jeff Copeland Thanks for the advice. I appreciate it.
just my opinion, but this is basically just a motor vehicle financing program your parents have set up. Like any other vehicle financing deal, the lender would always retain title until it is paid for. It sounds like their purchase contract may have stipulated that you would provide the title at closing or something to that affect, so you may have an issue, but if it wasn't stated like that I would not send that title to the buyer until they have paid it off in full....including the .55 every month.
Like @jeffcopeland said, I would contact the DMV for some advice.
Thank you @Reid Hanley !
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing