Please help, Legal advice?

Question

My mom is renting to own a house from my uncle. He has a mortgage out on the house for what he is selling it for. He went to his lawyers to draw up papers for my mom. He came back with a lease agreement that mentions nothing about her buying to own it. He said this is because he has a loan out on it. It is just a rental lease agreement for one year. He said this is what his attorney said to do. It's all very sketchy.

My mom doesn't really know what to do now. She wants to purchase this house from him, but is nervous about the agreement. She just wanted to have something in writing stating that she was renting to own this house. Can anyone give me a general idea as to what to write up and what to do for her. Anything that doesn't involve extra attorney fees would be great.

For instance, can I just say I am paying x amount for x yrs to puchase home located at such and such? I want it to be somewhat professional. I was thinking of having it notarized. Thanks!

Answer 1

It is easy to get stung with rent-to-own agreements.

If the person is unwilling to put it in writing, for whatever reason, just consider it a rental agreement, with no rights to own it, ever. If the rental seems fair, go ahead and rent it. Frequently, though, people say "rent to own" as an excuse to charge higher than market rent.

Even if it is in writing, there still could be problems. What if your "uncle" decides not to pay the mortgage? The bank will probably repossess the house, and then your mom is stuck, even if there was an agreement.

What is the character of your uncle? Presumably your mom would have some idea about that?

It would be better for your mom if she just purchased it outright, or some other house.

Answer 2

Yeah I agree. You really may want to have an attorney draw up something. See if you can get a free consult with a local attorney and talk to them about this. They can tell you right then what their fee would be to draw something up.

you can also go to Microsoft.com or do another search for rental and purchase leases and copy that to a word document and then make a few tweaks so that it fits your situation.

Answer 3

There is a tremendous amount of money involved, enough to make it worthwhile to pay an attorney.  Your mom needs to consult an attorney as to what kind of contract she needs.  Then, have your mom tell her brother to have his lawyer draw up the agreement to state what she wants on it.  If he won't do it, she can offer to pay to have her attorney draw up the agreement.  If the brother still won't go along, then she needs to consider buying a different house from someone else.

Answer 4

I'm going to guess that his mortgage doesn't allow him to rent out the property - that's a pretty common mortgage clause - so he doesn't want anything in writing saying he's renting it out, or his mortgage could be called.  But just having the lease agreement in writing ruins that, anyway.

That doesn't help your mom any, of course.  Would she still rent the house anyway?  Whether to continue without anything written is something only your mom can decide.