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We Had a Contract for Deed / Land Sales Contract But the Owner Went Bankrupt. – Dawn

Dawn

“Dear Steve,

We have a contract for deed on the property that we live in. We are the authorized users/contact with the mortgage company, Litton Loans, that our landlord has their mortgage with. We pay Litton directly for the mortgage and are current and have never been late. Our landlord recently filed Chapter 7 bankruptcy. We receieved a letter from the bankruptcy court stating that if we had any objections we needed to file an objection by July 28th. We have been pre approved for a loan to purchase the home but are having a hard time getting any returned calls from Litton. Any advice would be greatly appreciated.

Dawn”

Dear Dawn,

I am familiar with the process of selling property using a contract for deed or a land sales contract.

The reason why sellers like this method of selling the problem because they don’t have to transfer the property into the name of the buyer or record the contract at the court house. If you stopped paying, they don’t have to foreclose on you since until you get the title to the property, you own nothing. Your contract does not give you ownership rights, it gives you the right to purchase the property at a specified time or once the purchase price has been paid, or paid through installment payments.

Litton doesn’t care much that you made the payment, they’ll take the payment from anyone. Paying Litton gave you no ownership rights.

The land is an asset of the seller and now part of his bankruptcy proceedings. He had to list the property.

I would urge you immediately contact the bankruptcy attorney representing the seller and/or contact a real estate attorney to help you perfect this transaction so you can get the property in your name. Time is of the essence here. Do not delay in pursuing this through either or both attorneys.




About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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