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    Contract for deed in default

    Asked Mar 18, 2008, 10:29 PM 23 Answers
    Due to late payments ,late fees, three months behind on an unrecorded contract for deed I received letter in the mail stateting a foreclosure is not necessary they simply declare the contract null and void and giving me until April 1 2008 to pay off the note. I purchased the land in July of 2001. I am self employed plumbing contractor in the new house market and been hung out for the wolves in this market doing all I can paying every 3 months , I understand the seller being upset but I just want to know my rights . Texas is the state in which this contract for deed is . And in the event of failure to comply with any terms hereof by Buyer, Seller shall be entitled to any or all of the following remedies .
    a. seller shall be released from all obligations in law or equity to convey said property , and buyer shall foereit all rights thereto .
    If the property is used or to be used as buyers residence the provisions of sections 5.061-5.063 of the Texas Property Code shall apply to the default of the buyer.

    6. if the contract is terminated because of buyers default , Buyer will immediately surrender possession of the property to seller . If buyer fails to do so, Buyer will become a tenant in sufferance of seller , subject to an action for forcible detainer .
    That a little more of what the contract says. Also wondering about section 5.077 of the Texas property Code . All I received are tax statements for the property . Thanks to all for the thaughts and to your time.

    Last edited by mrplumber; Mar 19, 2008 at 05:36 PM. Reason: more imformation
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    23 Answers
    George_1950's Avatar
    George_1950 Posts: 3,100, Reputation: 236
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    #2

    Mar 19, 2008, 07:29 AM
    Welcome to AMHD. I suppose you are saying the seller will no longer accept installment payments and wants the note paid in full, and you will receive a deed. It is difficult to explain your rights if they are set forth on a contract which cannot be read. You may want to indicate your state and additional language of the contract if you would like an informal opinion. Or take your contract to an attorney for the real deal.
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    ScottGem's Avatar
    ScottGem Posts: 64,721, Reputation: 6013
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    #3

    Mar 19, 2008, 07:36 AM


    Your rights are specified in the contract. But generally if you are in default of the contract, the seller can declare the contract void and require full payment or reclaim the property.
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    mrplumber's Avatar
    mrplumber Posts: 7, Reputation: 1
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    #4

    Mar 19, 2008, 05:49 PM
    Quote Originally Posted by ScottGem
    Your rights are specified in the contract. But generally if you are in default of the contract, the seller can declare the contract void and require full payment or reclaim the property.
    Due to late payments ,late fees, three months behind on an unrecorded contract for deed I received letter in the mail stateting a foreclosure is not necessary they simply declare the contract null and void and giving me until April 1 2008 to pay off the note. I purchased the land in July of 2001. I am self employed plumbing contractor in the new house market and been hung out for the wolves in this market doing all I can paying every 3 months , I understand the seller being upset but I just want to know my rights . Texas is the state in which this contract for deed is . And in the event of failure to comply with any terms hereof by Buyer, Seller shall be entitled to any or all of the following remedies .
    a. seller shall be released from all obligations in law or equity to convey said property , and buyer shall foereit all rights thereto .
    If the property is used or to be used as buyers residence the provisions of sections 5.061-5.063 of the Texas Property Code shall apply to the default of the buyer.

    6. if the contract is terminated because of buyers default , Buyer will immediately surrender possession of the property to seller . If buyer fails to do so, Buyer will become a tenant in sufferance of seller , subject to an action for forcible detainer .
    That a little more of what the contract says. Also wondering about section 5.077 of the Texas property Code . All I received are tax statements for the property . Thanks to all for the thaughts and to your time.
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    ScottGem's Avatar
    ScottGem Posts: 64,721, Reputation: 6013
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    #5

    Mar 19, 2008, 06:18 PM


    First, please don't add a follow-up by editing the original post. It makes it difficult to follow the thread. Also no need to post the same thing multiple times.

    Second the answer to your question is in what you posted. The seller doesn't seem to have the right to require that you pay in full, but he does have the right to evict you.
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    JudyKayTee's Avatar
    JudyKayTee Posts: 46,506, Reputation: 4594
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    #6

    Mar 20, 2008, 06:41 AM
    [QUOTE=mrplumber]... if the contract is terminated because of buyers default , Buyer will immediately surrender possession of the property to seller . If buyer fails to do so, Buyer will become a tenant in sufferance of seller , subject to an action for forcible detainer .


    That's the language that sums it up - it appears you are in default, the contract is legally terminated, you must surrender possession, the seller can evict you.
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    mrplumber's Avatar
    mrplumber Posts: 7, Reputation: 1
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    #7

    Mar 20, 2008, 09:35 AM
    Are their cure days or procedures that can keep that from happening . So for just phone conversation . Thanks
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    ScottGem's Avatar
    ScottGem Posts: 64,721, Reputation: 6013
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    #8

    Mar 20, 2008, 09:53 AM


    Keep what from happening? The language of the contract is clear. You are in default, the seller is declaring you in default and telling you either pay me in full or vacate. That he's given you an option to pay the balance is being nice on his part. He doesn't have to do it.
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    JudyKayTee's Avatar
    JudyKayTee Posts: 46,506, Reputation: 4594
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    #9

    Mar 20, 2008, 09:59 AM
    Quote Originally Posted by mrplumber
    are their cure days or procedures that can keep that from happening . so for just phone conversation . thanks

    Sure - pay what you owe him, stay current, hope he gives you a second chance.
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    mrplumber's Avatar
    mrplumber Posts: 7, Reputation: 1
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    #10

    Mar 20, 2008, 03:40 PM
    All your thaughts are greatly appreciated , thanks
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    Fr_Chuck's Avatar
    Fr_Chuck Posts: 80,534, Reputation: 7612
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    #11

    Mar 20, 2008, 05:24 PM
    Ok, once you are behind, they can declare the entire loan due and payable. So if they will not work it out, he has the right to declare it due.

    Once you are in default and he declares you in defaut ( and you will be after the date he gave you to pay in full) this reverts to a month to month rental, *** but he is not required to rent to you, but can merely evict you.

    So you need to try and work something out, or be ready to move.
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    mrplumber's Avatar
    mrplumber Posts: 7, Reputation: 1
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    #12

    Mar 20, 2008, 06:08 PM
    Even if theirs no certified mail saying anything about being in default. And do the Texas property codes mean anything in this case
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    JudyKayTee's Avatar
    JudyKayTee Posts: 46,506, Reputation: 4594
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    #13

    Mar 20, 2008, 06:12 PM
    Quote Originally Posted by mrplumber
    even if theirs no certified mail saying anything about being in default. And do the Texas property codes mean anything in this case

    Once again - there is a contract and you have violated it. I see nothing to indicate the contract is contrary to Texas law. If you don't believe what has been posted consult with an Attorney.

    Pay the man his money or get evicted.
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    Fr_Chuck's Avatar
    Fr_Chuck Posts: 80,534, Reputation: 7612
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    #14

    Mar 20, 2008, 06:18 PM
    If you don't honor their request to move, I would assume you could in your eviction heaing force them to send you a certified letter, which would allow you a little more time before they can throw you out.
    But only payment of the debt will change the default status.
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    mrplumber's Avatar
    mrplumber Posts: 7, Reputation: 1
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    #15

    Mar 20, 2008, 06:44 PM
    The entire note or just the payments and late fees making it default
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    JudyKayTee's Avatar
    JudyKayTee Posts: 46,506, Reputation: 4594
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    #16

    Mar 21, 2008, 05:35 AM
    Quote Originally Posted by mrplumber
    the entire note or just the payments and late fees making it default

    That's up to the landlord - at this point he can demand it all, refuse it all and evict you, allow you to bring it up to date. It's his call; he's in the driver's seat.
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    ScottGem's Avatar
    ScottGem Posts: 64,721, Reputation: 6013
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    #17

    Mar 21, 2008, 05:39 AM
    Basically you have no rights. By defaulting on contract, you put yourself at the mercy of the seller. If he declares that you are now a tenant, and seeks to evict, you MAY be able to get out of the eviction (temporarily) by bringing your payments up to date. However, since you would then be considered a month to month tenant, he can terminate your tenancy at any time.
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    Dr D's Avatar
    Dr D Posts: 698, Reputation: 127
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    #18

    Mar 21, 2008, 01:33 PM
    In AZ, and I would think in other states, when a Contract For Deed is in default, the seller must record, and serve the buyer with an Affidavit Of Forfeiture. The forfeiture period is determined by the percentage of equity that the buyer has in the property. The greater the equity, the longer the forfeiture period. Whether your state law provides for acceleration of the debt (all due and payable) or if that is addressed by the Contract For Deed, I don't know. For your sake, you really need to see a good Real Estate attorney.
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    JudyKayTee's Avatar
    JudyKayTee Posts: 46,506, Reputation: 4594
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    #19

    Mar 21, 2008, 03:40 PM
    Quote Originally Posted by Dr D
    In AZ, and I would think in other states, when a Contract For Deed is in default, the seller must record, and serve the buyer with an Affidavit Of Forfeiture. The forfeiture period is determined by the percentage of equity that the buyer has in the property. The greater the equity, the longer the forfeiture period. Whether your state law provides for accelleration of the debt (all due and payable) or if that is addressed by the Contract For Deed, I don't know. For your sake, you really need to see a good Real Estate attorney.

    He posted the language in the contract and it does not appear to say anything about "the greater the equity, the longer the forfeiture period." It pretty clearly spells out the terms and conditions - are they in violation of his State Law? That I don't know. I do know all of this foot dragging is not helping OP's cause.
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    Dr D's Avatar
    Dr D Posts: 698, Reputation: 127
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    #20

    Mar 21, 2008, 05:08 PM
    I believe that the Forfeiture period is dictated by AZ statute, and determined by the percentage of equity of the original sales price. If a provision of a contract is in conflict with state law it cannot be enforced, but does not void the entire contract. I don't know the laws of Texas, but this person should seek the advice of legal counsel.
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