Question by ****: What happens if your land contract holder does not sign off on the contract after I refinanced via bank?
My brother sold me my home on a land contract for 5 years then 2 years later pressured me to refinance via the bank. He had to knock off $ 8000 off the selling price because the amount owed was more than the bank would finance. We entered into a verbal agreement outside of the mortgage for me to pay the $ 8000. I had assumed that he had contacted the same financing bank who also was handling the land contract as a broker to tell them the land contract was paid but he did not and failed to tell me this. He provided a warranty deed with the mortgage sale. Would he not be required to cancel the land contract? He wants me to pay him personally but refuses to sign off on the land contract first. I told him I will pay the broker bank my payments on the $ 8000 unless he cancells the land contract. What are my rights?
Answer by mark a
The warranty deed: Who’s name is on it. If it is yours you are okay.
Land contract is also known as a seller financed or owner carryback. There is also the statue of frauds which means that all interests in real estate must be in writing. Put down the 8k in writing so he cant later put a lien on your house by showing the earlier contract. He is in the drivers seat and you need to contact a lawyer or another broker in your state.
This is not legal advice, please seek the counsel of a properly licensed attorney or real estate broker.
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So there was a original contract for say 50K, that your brother was the lein holder. 2 yrs later he asked you to get it refinanced throught a bank and they would only loan 42K. Right? Now when the bank did the note for 42K did your brother file a 2nd lein for the 8K? He might not have but atleast you 2 should have wrote out another note for the 8K. If you closed at a title company with the bank loan, which I am sure you did, the original contract had to be part of their file to close this transaction. It sounds like you still owe your brother the 8K (or balance of), the problem being who and how do you pay him. This should be set up as a note over XXXX amount of years. You and your brother need to get together and work this thing out. You need to make timely payments to him and get it over with. I would try and pay him off asap.