Home Selling in 33461>Question Details

Julie Hernan…, Home Buyer in Lake Worth, FL

Here is the scenario, I had my rental property on the market & found a tenant who wanted to do a lease with

Asked by Julie Hernandez, Lake Worth, FL Wed Mar 12, 2008

option to buy, I did the contract with a realtor, the tenant paid all his deposits (total like $6000) then tenant defaulted on his agreement 6 mths in & we never heard from him again, Does the Seller get a % back of the non refundable money that the buyer made?

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Julie
I do not know your area specifically. Normally a tenant pays first, last, and a damage deposit. On lease it is customary in my area for the tenant to pay the commission to the Realtors with cashier's checks that are deducted from the total.

For example, if the rent is $2,000 a month, a one lease is $24,000. If the property was listed at a 6% commssion, each Realtor receives 3%, or $720 each, $1,440 total. So the tenant total deposit is $6,000, less the $1,440, the remainder $4,560 would be in the form os a check issued to you, the landlord.

Your area may have different customs, I would suggest reviewing the contract. Certainly if you have questions ask your Realtor, if they do not have answers ask their broker. If you have additional questions .
1 vote Thank Flag Link Wed Mar 12, 2008
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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There are three documents ia a proper "Lease with option to buy" agreement:
1) The option money agreement. Normally non refundable or goes towards a downpayment on the property.
2) The lease agreement. Should be drawn up by an attorney. There are a lot of pitfalls for the landlord.
3) The purchase contract a FAR or FAR/BAR contract
These deals are complicated and usually needs another document to tie the 3 docs together, an attorney matter. In your case, if it was the option money, you should keep it minus ev commission.
Web Reference: http://www.peterwjust.com
0 votes Thank Flag Link Tue May 27, 2008
Normally the Landlord keeps all the money except for the commission on the rental. You should review the default clauses in the contract and speak with the Managing Broker of the Real Estate Company to explain. But you should be receiving 50% or more of the funds. All of this would depend on what the contract says. As a disclaimer I'm not a lawyer.
0 votes Thank Flag Link Wed Mar 12, 2008
Herman Chang, Real Estate Pro in Palm Beach Gardens, FL
MVP'08
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Thank you Mr. Tepper for your quick repsonse, but I (the Seller) did not pay funds to anyone, the buyer paid all the money to the realtor, I understand it's non refundable but I thought It was non-refundable to the buyer so the realltor keeps it all?
0 votes Thank Flag Link Wed Mar 12, 2008
It all depends on what the contract provides. I'm not a lawyer, and I don't have a copy of your contract in front of me, so I can't answer definitely. However...

Most lease-option contracts provide that the option consideration (both the upfront amount and any monthly amount credited) is nonrefundable if the tenant-buyer does not exercise the option. Judging from your question and reference to "non refundable money," it sounds as if the contract specifies that such funds were nonrefundable.

If that's the case, then no, the seller does not receive back a portion of his/her nonrefundable option fee.

You may, if you wish, voluntarily return some of the money. That's sometimes done, though rarely. But, if the contract states that the option fees are nonrefundable, then that's just what they are.

Hope that helps.
0 votes Thank Flag Link Wed Mar 12, 2008
Don Tepper, Real Estate Pro in Burke, VA
MVP'08
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