Foreclosure Property Marketing Manager
You're really asking two questions.
1) can seller financing have a tax impact on the seller, and
2) can the seller change the contract late in the game.
For the answer to #1, it's likely your seller is attempting to complete a 1031 tax deferred exchange. if that is the case there are implications to his taxes, and how his seller financed note is structured and handled will make a difference to him. You can get more details in this article:
Regarding #2. If you both have committed to the deal and all contingencies have been removed it is likely you both have a contractual obligation that cannot be changed without mutual consent. However, we don't have enough details about your particular transaction to understand if that is the case here.
You should consult with an attorney to review your contract in order to determine where you stand in the transaction. You may also want to consult your accountant or financial adviser to review the changes in the financing to see if there really is a significant impact to you.
Best of luck!
Allan S. Glass
ASG Real Estate Inc. Â®
149 S. Barrington Ave, Suite #660
Los Angeles . CA 90049
Direct: 213.973.8637 (213.97.FUNDS)
CA License: 01154002
Visit Allanâ€™s Blog: http://allanglass.featuredblog.com
Thanks everyone for the detailed insight. At this point, I've lifted my inspection contingency but the seller still has yet to produce all the documents he's agreed to provide before all contingencies are removed.
I just don't like the fact that the seller and his agent are essentially threatening to blow up the sale if I don't do what the seller wants, even though he's already signed the sales contract and all addendums explicitly defining the financing terms as interest-only. It's a bit ridiculous that the seller's agent would warn me that if I don't agree to changing the terms that "this is a deal breaker for [the seller]" -- from what I've read, it seems more like "breach of contract BY the seller".
Best of luck.. if you find my answer useful, give it a Thumbs Up!
Hope this helps!
Aziz Hasnain, Broker
Nothing can be changed without both parties agreeing to it, if you do not agree to his requests, it cannot be changed.
If the seller does not close consult an attorney.
8700 Reseda Blvd., Suite 213-B
Northridge, California 91324
(818) 967-9626 mobile
(818) 979-0226 fax
But, if he is trying to do a 1031, and it sounds likely, he has to get your co-operation, in writing!
If he doesn't do the 1031, precisely as it is spelled out, he won't get it.
This isn't so much as a "Buyer Beware" as it is a "SELLER BEWARE":
Let your Realtor do your talking for you.
If in fact they want to do a 1031 as Allan suggested, this is not a big deal. It doesn't cost you anything in and of itself, but if it delays the closing you should require the seller to pay your costs in exchange for you cooperating. This is standard operating procedure when one party delays closing.