[WSBAPT] Real Estate Contract conundrum

Sat Jun 13 08:14:38 PDT 2015

Bob has  it right on. Here is a sample form from the LPO form site at the
WSBA.
Also, the link to the LPO forms. You probably want the LPB 44. The 45 is for
commercial and farms.
http://www.wsba.org/Licensing-and-Lawyer-Conduct/Limited-Licenses/Limited-Pr
actice-Officers/LPO-Forms
If you have questions about completing the form, or how to structure these,
call me.

Your clients should also use a contract collection service to receive and
track payments. The do it yourself approach to collecting payments results
in poor payment tracking, improper calculation and tracking of actual
receipt of principal and interest and then incorrect reporting of interest
received for income tax purposes.
Check out INCS for collection of payments. The typical setup fee is only
$125, or $150 if the Fulfilment Deed is held in true escrow (which is
beneficial to the buyer  if the seller dies), and the monthly service fee is
only $10. I am handling a quiet title for a buyer who did not receive a
fulfilment deed because they paid off 20 years ago and thought that was
that. Sad story. True escrow avoids that problem.

http://incsnoteservices.com/

Full disclosure: My wife and I own this collection service. We have a full
time Operations Manager, Tracey Lockwood. Feel free to call her.

Mike Winslow

Michael A. Winslow
1204 Cleveland Ave.
Mount Vernon, WA 98273
Ph. 360-336-3321
Em. Mike at winslegal.com

This message is from an attorney, so it's confidential. If you are not the
intended recipient, it's too late to stop reading this message, but you may
not use it for any improper purpose. Huge Disclaimer available upon request.

From: wsbapt-bounces at lists.wsbarppt.com
[mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Robert R. Cole
Sent: Friday, June 12, 2015 4:49 PM
To: WSBA Probate & Trust Listserv
Subject: Re: [WSBAPT] Real Estate Contract conundrum

It is called a "wrap around" contract.  New REC with the New Buyer paying
both the Original Seller and the Old Buyer their equity.  It is actually on
the standard REC form as an "Assumed Obligation", and there will also be
Payment of Amount Financed by Seller.  It is actually rather
straightforward. Us old codgers did it all the time in the 80s.
Very Truly Yours,
Robert R. Cole
Law Office of Cole & Gilday, P.C. 

10101 - 270th St. NW 
P.O. Box 249 
Stanwood, WA 98292 
(360) 629-2900 (Telephone) 
(360) 629-0220 (Fax) 

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On 6/12/2015 4:26 PM, Amy Pivetta Hoffman wrote:
All,

Seller and Buyers enter real estate contract ten years ago for 20 year term.
Now, a new buyer has arisen and old buyers and seller want to sell.  Seller
and old buyers are close family.  New buyer unrelated. 

The problem is that old buyers want to recoup what they've paid-new buyer
has agreed to price that would cover remainder on contract plus what old
buyers have paid.

I have gone around and around about how to handle this properly.  All
parties tentatively agree on terms, I just can't figure out how to structure
this properly.

My thoughts are:

1.       Seller gives Old Buyers Partial Fulfillment Deed.  No excise
consequence.  Now Seller and Old Buyers are all Sellers with title, but
Contract remains partially unpaid as to old buyers.
2.       If I draft a Deed and Purchaser's Assumption of Real Estate
Contract, we don't get to modify for new price, etc. and Old Buyers are cut
out without a separate agreement (Unsecured Promissory Note)
3.       If I draft a Fulfillment Deed, original Seller is cut out because
he no longer owns and no way to get the rest of his money. 
4.       If I draft an entirely new Real Estate Contract with new terms for
all Sellers and New Buyer, the old contract hangs out there and clouds
title.

Can anyone suggest a document path that will allow both Seller and Old
Buyers to recoup their share of the new purchase price and not compromise
title?

Help please!

Amy Pivetta Hoffman
Ph. 253.720.3020/F. 253.200.0855
PO Box 73040, Puyallup, WA  98373
APH
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