Is it legal and/or enforceable to have a clause in a contract for sale of a house with owner financing that if the buyer misses two consecutive payments that he/she forfeits the money previously paid? If so, how realistic is it that the seller will be able to "evict" the purchasers so as to either rent or resell the property?
- Thread starter BigDaddy
- Start date
Forfeiture Clause
Of course you forfeit the money previously paid. Where do you come from Iraq?BigDaddy said:
Eviction just takes a little time. You ought to just pay the damn mortgage or get out. The laws aren't that dissimilar than where you come from. You think you are entitled to be stupid in the DR? Break the contract and you lose, simple. May cost the rightful owner a few bucks but you will be out on your arse.
I'm glad to hear that because
Actually, I am not the buyer. I would be the person attempting to enforce the clause. Before I entered a contract, however, I wanted to know whether the clause would be worth the paper it was written on, here in the D.R.
Escott said:
Actually, I am not the buyer. I would be the person attempting to enforce the clause. Before I entered a contract, however, I wanted to know whether the clause would be worth the paper it was written on, here in the D.R.
BigDaddy said:
OOooooops!!!!!
I DO admire your restraint re the above post BigDaddy - you must have the patience of Job!!
I would heartily recommend waitng for the response from the legal guru on this board Fabio Guzman, but if you need something quicker than this weekend (Fabio is normally doing his stuff on Saturday or Sunday) then I'll gladly recommend a couple of other reputable lawyers on the North Coast who could answer your question. ~ Grahame.
Chris said:
Forgive her folks ..... we've been working on labels for two days now and Chris is obviously tired.
This is standard anywhere I have ever seen it. I don't think that there is any expectation of recouping other then in certain situations...BigDaddy said:
A friend who does mortgages told me that it costs him 20% to forclose and evict one way or the other. If he can he would rather BUY someone out of the house with the same money so he figures it into his mortgage. He usually only give 40% Loan to Value. Even after paying the 20% there is still enough left in it for him for his time and effort.
Another tip would for YOU to hold title in your name and give a contract sale back to the borrower. Much cleaner that way. This is what I do and I ha ve had 8 transactions in the last 6-7 months without a hitch. My downside should be less than the 20% my friend figures since I only have to do at the most an eviction and not a forclosure and a eviction. They don't pay, I already own the property and they have broken the contract.
PM me if you want more information about this. The petty people are listening and I would hate to give them a clue
Escott
For what, answering his question? Seems as if only the Petty people were bothered rather than someone seeking info which he did get from me and more.Chris said:
Edited to Add:
From you he just got some gum flapping
Ta ta,
Escott
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Escott said:
Yes, .. my gum was flapping at you because of your first rude post. But then, you turned around and gave good information, which is your way of apologising. Now I must just convince some others of my logic and that you actually apologised in your own way for your first post and that I win the bet... and I too can make some money on this.!
More seriously, I learnt something out of your response as to how you handle these kinds of clauses in RE in the DR. We've at last bought something that we really like and will be building in the future for rental or sale. So, it was good information for me.
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Wrong again, I gave him answers on my FIRST post. On my second post I gave him information to help him once he stated that he was on the OTHER side of the fence. He asked if forfeiture was enforceable and I said yes. You need to read the question and then see if there was an answer instead of flapping the gums.Chris said:
Good luck with your property.
Quote:Another tip would for YOU to hold title in your name and give a contract sale back to the borrower. Much cleaner that way. This is what I do and I ha ve had 8 transactions in the last 6-7 months without a hitch. My downside should be less than the 20% my friend figures since I only have to do at the most an eviction and not a forclosure and a eviction. They don't pay, I already own the property and they have broken the contract.unQuote
This is exactly what my wife does. She holds the title until the contract(loan) is paid and then, and only then, does the title get transfered over.
This is exactly what my wife does. She holds the title until the contract(loan) is paid and then, and only then, does the title get transfered over.
The clause is valid and you will be able to evict since you have kept the property of the house.
What?s not valid is to give a mortgage loan on a house belonging to the debtor and stipulate in the contract that in case of nonpayment the house will be yours automatically, without going through foreclosure proceedings (Art. 2088 of the Civil Code).
This would be one way to attack what some of the participants in the thread are doing, disguising loans as sales to avoid foreclosure. If the debtor establishes in court that the real intent of the parties was a loan agreement and not a sale, the lender will not be able to evict until the end of the foreclosure proceedings. Fortunately for the lenders, most debtors have neither the knowledge nor the funds to hire a lawyer to fight eviction in these cases.
What?s not valid is to give a mortgage loan on a house belonging to the debtor and stipulate in the contract that in case of nonpayment the house will be yours automatically, without going through foreclosure proceedings (Art. 2088 of the Civil Code).
This would be one way to attack what some of the participants in the thread are doing, disguising loans as sales to avoid foreclosure. If the debtor establishes in court that the real intent of the parties was a loan agreement and not a sale, the lender will not be able to evict until the end of the foreclosure proceedings. Fortunately for the lenders, most debtors have neither the knowledge nor the funds to hire a lawyer to fight eviction in these cases.