Home Buying in 55046>Question Details

Sherri Louks, Home Buyer in Burnsville, MN

I signed a contract for deed that was never filed and now I can not get financing as the house is not appraising...can I cancel the contract?

Asked by Sherri Louks, Burnsville, MN Sun Feb 20, 2011

He originally wanted $159000 for the house but it is not even appraising for $130000...he never filed the contract with the county but it was notarized. Am I by law still contracted to buy this house? I have asked for a cancelation of contract and he agreed but that was over 2 weeks ago and he still hasnt' sent it and never answers my calls.

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Sherri, so much of this is going on these days. It's my understanding that, when you enter in to a contract for deed, if you do not carry out the terms of the contract and secure your own outside financing within the specified period of time, your seller can foreclose and repossess the property. If they take it that far, it can be reported to the credit bureaus as a foreclosure on your credit. I understand about your being upside down in value. Is there an appraisal contingency to address this in your contract?

Good luck, Sherri!
1 vote Thank Flag Link Wed Feb 23, 2011
Did you have an appraisal contingency in the contract to address this ??
1 vote Thank Flag Link Sun Feb 20, 2011
VENDEE
A purchaser; a buyer.

Minesota Statue:

"All contracts for deed executed on or after January 1, 1984, shall be recorded by the vendee within four months in the office of the county recorder or registrar of titles in the county in which the land is located. Any other person may record the contract. "


This sounds like the buyer was responsible for this. And now wants out because he/she violated the statute?

Am I missing something?
1 vote Thank Flag Link Sun Feb 20, 2011
Sherri, I hear your frustration. You need to speak with a real estate attorney ASAP. This is pure and simple contract law at play. If you had a real estate salesperson help you with the contract for deed, you can re-engage with them to help get this resolved, however, t the bottom line is you will need an attorney to resolve.
1 vote Thank Flag Link Sun Feb 20, 2011
Minnesota law states the contract should be recorded within 4 months of purchase I would contact a lawyer if you can't work it out. http://www.mnhomescontractfordeed.com view this contract for deed site Minnesota - Contract for deed info and listings. Good luck.
0 votes Thank Flag Link Sun Jun 10, 2012
A contract for deed (aka land contract) is essentially another form of financing. I'll paraphrase your question: you're basically asking to cancel that note, because you're upside-down. Unfortunately, that's one of the risks that comes along with buying a property, and you're certainly not alone. If you tried to cancel a bank financed note just because you're upside-down, then I don't think you'd get very far with that request. I suspect your seller might be in a similar position with the banks. Of course, you'll want to run this past a knowledgeable real estate attorney.

Some alternatives might be for you to approach your seller/lender to do a loan mod, to discuss the possibility of a short-sale, or to take the deed back in lieu of foreclosure. Another alternative--if your seller is open to doing a lease-option--is that I (or other investors) might be interested taking over the property.
0 votes Thank Flag Link Sun Feb 20, 2011
Steele,

You are absolutely right - I was reading the statue incorrectly.
0 votes Thank Flag Link Sun Feb 20, 2011
Steele,

A quick Google search provides us with the statute: https://www.revisor.mn.gov/statutes/?id=507.235
Web Reference: http://www.AaronSOLD.com
0 votes Thank Flag Link Sun Feb 20, 2011
As a clarification, where in the statutes does it state that the C/D must be recorded? Would like the actual cite and the statement of who is responsible for this. Thank you.

Steele
0 votes Thank Flag Link Sun Feb 20, 2011
Sherri, contact a Real Estate attorney. If you used a Realtor to help you buy this house, contact them also. Good luck.
0 votes Thank Flag Link Sun Feb 20, 2011
Consider consulting with an attorney who specializes in real estate, he/she can best advise as it relates to your specific situation--accurate advise prevents future problems.
0 votes Thank Flag Link Sun Feb 20, 2011
Contract for Deeds must be recorded at the county per state law so the fact that it wasn't may provide you recourse even if the seller does not cancel the contract voluntarily. This is a situation where you would be wise to discuss the situation with an attorney as there are legal issues here that need to be handled by a professional.
Web Reference: http://www.MNseller.com
0 votes Thank Flag Link Sun Feb 20, 2011
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