Just wanted to run this through the scam and BS detectors here.
Concerns my parents home in the Austin area.
Mom...retired. Dad...retiring. They are moving back to DFW to be near family and have had cash buyers under contract since Nov 1st with closing today. Their story...empty nesters and he's in commercial real estate in a rent house needing new place by 12/1.
Mom and Dad have a very thin financial situation for retirement...need every bit of the modest proceeds to fund their next home and related expenses.
Here is the big thing to know about Dad...he's a stubborn old school guy. He's sold their three previous homes by owner with no real hiccups. Despite my pleas to pay a Realtor to look out for their interests each time, he's been proven right thus far so no chance he was doing any but FSBO this time. He does pay a licensed Realtor that he knows back here in Dallas a nominal consulting fee to review and advise on docs and general process.
So back to the buyers....seems too good to be true but they sign the contract and put up $1000 earnest - which I told Dad was probably too little. Dad had the place listed at a very fair price, maybe a little low even, so there was no negotiation. Guy simply asks for some lawn equipment to be included. Everything seems to be in order and progressing toward closing today...Mom and Dad signing today and the buyers signing tomorrow.
The other thing to mention is that my parents did not ask for a leaseback with time to move out after closing. Instead they moved out two days ago and all their stuff is here in DFW now. So the buyers are able to take the house immediately after closing.
According to Dad, buyers show up at title company appointment this morning stating he was unable to pull the funds together here at the finish line. His story is that some misunderstanding between he and his business partner resulted in him not having access to the money he expected to buy the house with.
Buyer says he is now working on putting together new funding but it could take 2 to 4 months. Mom and Dad meet with this buyer and his wife for over an hour and, despite being naturally distrustful of just about everyone, are absolutely convinced of their sincerity and good intentions. The buyers, extremely remorseful, still need a place to live and asked if mom and dad would be willing to lease the house to them at $2000/month until they have the money. He also does not hesitate to offer additional earnest money by tomorrow so they can move in Sat.
This puts a wrench in mom and dad's plans who are now unable to buy their new place until this home sale funds. But after consulting their realtor friend and getting agreement on additional earnest money and rent payment which is significantly higher than their mortgage payment, they agree to this lease arrangement.
Of course I have all kinds of questions for Mom and Dad but they are putting their faith in these buyers.
So my question for the board...anything sounding like a known scam? Any big risks here with this temporary lease arrangement and letting them move in, other than the potential for sale to ultimately fall through? Any advice? Questions to ask?
I know crazy things happen to good people but my BS detector is going off big time.
Concerns my parents home in the Austin area.
Mom...retired. Dad...retiring. They are moving back to DFW to be near family and have had cash buyers under contract since Nov 1st with closing today. Their story...empty nesters and he's in commercial real estate in a rent house needing new place by 12/1.
Mom and Dad have a very thin financial situation for retirement...need every bit of the modest proceeds to fund their next home and related expenses.
Here is the big thing to know about Dad...he's a stubborn old school guy. He's sold their three previous homes by owner with no real hiccups. Despite my pleas to pay a Realtor to look out for their interests each time, he's been proven right thus far so no chance he was doing any but FSBO this time. He does pay a licensed Realtor that he knows back here in Dallas a nominal consulting fee to review and advise on docs and general process.
So back to the buyers....seems too good to be true but they sign the contract and put up $1000 earnest - which I told Dad was probably too little. Dad had the place listed at a very fair price, maybe a little low even, so there was no negotiation. Guy simply asks for some lawn equipment to be included. Everything seems to be in order and progressing toward closing today...Mom and Dad signing today and the buyers signing tomorrow.
The other thing to mention is that my parents did not ask for a leaseback with time to move out after closing. Instead they moved out two days ago and all their stuff is here in DFW now. So the buyers are able to take the house immediately after closing.
According to Dad, buyers show up at title company appointment this morning stating he was unable to pull the funds together here at the finish line. His story is that some misunderstanding between he and his business partner resulted in him not having access to the money he expected to buy the house with.
Buyer says he is now working on putting together new funding but it could take 2 to 4 months. Mom and Dad meet with this buyer and his wife for over an hour and, despite being naturally distrustful of just about everyone, are absolutely convinced of their sincerity and good intentions. The buyers, extremely remorseful, still need a place to live and asked if mom and dad would be willing to lease the house to them at $2000/month until they have the money. He also does not hesitate to offer additional earnest money by tomorrow so they can move in Sat.
This puts a wrench in mom and dad's plans who are now unable to buy their new place until this home sale funds. But after consulting their realtor friend and getting agreement on additional earnest money and rent payment which is significantly higher than their mortgage payment, they agree to this lease arrangement.
Of course I have all kinds of questions for Mom and Dad but they are putting their faith in these buyers.
So my question for the board...anything sounding like a known scam? Any big risks here with this temporary lease arrangement and letting them move in, other than the potential for sale to ultimately fall through? Any advice? Questions to ask?
I know crazy things happen to good people but my BS detector is going off big time.