A year ago we signed papers to do a lease purchase with a sales contract also. Two weeks after we moved into the home we found out the home was in foreclosure. The people on the loan (ex-boyfriend/girlfriend) caught up the arrears. Originally they had a fixed rate and then an adjustable rate mortgage. In August, the payments went up and we still paid our same amount (to the mortgage company) and they are responsible for the difference. Which has not been paid since the payment increased. Evidently they also let the insurance lapse so the mortgage company put their own insurance on it. I have been told by the male owner that he has caught up the back taxes, he has lied on numerous occasions that he has mailed the payments to the mortgage company for the arrearage and also the subdivision has a lien on the home. What rights do we have. I have not made this months payment yet and stopped payment on my last payment as we believe we are going to be blind sided when the mortgage company decides to put it in foreclosure again. PLEASE HELP!! We went into this arrangement because we have less than perfect credit. Also, as of February 1st the adjustable rate will increase the payment again. Is this considered breach of contract on their part?

What does the contract has in it. It is bad business, and it looks like they will breach the contract ( when it is foreclosed on) but I actually doubt it is a real breach until it is actually foreclosed.

If the contract says they will funish the insurance, then that may be a breach.

It does look at obvously they are not gong to pay and you will lose the home, so it may be of benefit for you to file a suit against them, and have your payments put into escrow pending their fixing all of the issues at this point.

Of course if they have nothing, basically you won't get any deposit back most likely anyway.

Since the mortgage company is involved and you make payments to them, have you discussed having them just refinance the property in your name only?