Contract for conveyance forfiture
Joe B
conveyance 10 years ago. The buyer never took possession of the
property nor did he ever make any payments. I will assume that the
seller assumed that since no payments were ever received that the
contract was void. The property has been a rental for the past 10
years.
The contract called for an interest rate of 10% and 360 equal monthly
payments of $500 with a 5% penalty for late payments. The buyer was to
pay all taxes and insurance. Even though the buyer never made a single
payment he had recorded the contract and this now clouds the title. The
seller never filed for a forfiture.
I know that a non-judicial forfiture would take care of this. My
question is, does interest continue to accrue at 10% on the principle
and accrued interest (compounding) or can I demand only simple interest
(10% of the principle per year).
If I'm not mistaken, the buyer can bring the contract current by
simply paying 10 years of payments ($60,000) plus the penalty, taxes
and insurance. Is the balance on the contract now the original contract
amount plus accrued interest or is the buyer back on schedule and does
he only need to make 240 more $500 payments?
Robert Bonomi
short answer: "Yes. Maybe. Some of the above."
The answers to the questions you ask depend on the _exact_language_ of
the contract. Absent the actual contract language nobody else can even
guess intelligently about the matter. And my crystal ball is on the
fritz, so you're going to _have_ to show somebody the actual contract.
Take the piece of paper, go see a real lawyer. get REAL answers. <grin>
Stuart A. Bronstein
> I have a property (inherited) that was sold on a contract for
> conveyance 10 years ago. The buyer never took possession of the
> property nor did he ever make any payments. I will assume that
> the seller assumed that since no payments were ever received
> that the contract was void. The property has been a rental for
> the past 10 years.
Did you have a mortgage or deed of trust to secure the debt?
> The contract called for an interest rate of 10% and 360 equal
> monthly payments of $500 with a 5% penalty for late payments.
> The buyer was to pay all taxes and insurance. Even though the
> buyer never made a single payment he had recorded the contract
> and this now clouds the title. The seller never filed for a
> forfiture.
Did he record a contract of sale, or did he record a deed? This
makes a big difference.
> I know that a non-judicial forfiture would take care of this. My
> question is, does interest continue to accrue at 10% on the
> principle and accrued interest (compounding) or can I demand
> only simple interest (10% of the principle per year).
At least in California if you do a non-judicial foreclosure you can't
claim any additional money from the buyer. If that's the rule in the
state you are in, it doesn't make any difference.
> If I'm not mistaken, the buyer can bring the contract current by
> simply paying 10 years of payments ($60,000) plus the penalty,
> taxes and insurance. Is the balance on the contract now the
> original contract amount plus accrued interest or is the buyer
> back on schedule and does he only need to make 240 more $500
> payments?
In California, after notice of foreclosure the buyer has 90 days to
bring the loan current. I'd have to read the contract and note, but
my guess is that you could require interest payments for him to bring
it current.
Stu
David Martel
You inherited a piece of real property. 10 yrs. ago someone purchased
this property through a contract of conveyance but failed to make any
payments. This purchaser did record the contract. You ask for advice.
Without having a conversation with you which would begin with " In what
Country is this property?" and continuing from there it is impossible to
give more helpful advice than to seek a lawyer in that Country, State,
County. Advice on real estate law, inheritance and contracts may be needed
but start with a real estate lawyer.
Good luck,
Dave M.