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.

Choose the lesser of two evils...put the home back on the market. 99.9% of the time things will get worse with these folks than you can imagine.

Amen.

Oh and I need to send my latest Puppy pic. Ranger has filled out. Big fella for 10 months. 60-65 easy

Definitely...my girl is three now and only 60. You're gonna have a big fella on your hands. I'll get some pics over to ya in the morning. Just got back from camping in Conroe with clients/friends.

Sound advice

Thanks for your feedback guys. Definitely solidifies my instinct that this is a bad deal they need to walk away from.

Hopefully they will listen to me and not allow their desperation to get this over with cloud their judgement.

Will let you know how it turns out. May be back asking for referrals on an Austin area as agent.

Figure out what the place is worth and put it on the market for full market value.

I don't understand why people want to give away money to complete strangers instead of their own families.

I appraised a home this summer that a lady decided to sell herself to avoid paying the $6,000 realtor fee. She cost herself about $40,000 over and above the realtor fees.

I wouldn't spend any more time on people who show up to close with no money. Buh-bye.

Austin has cooled some but if they quickly got a buyer at a FSBO price that you think was maybe a bit under market then hopefully it would move quickly again and maybe even realtor fee would be a wash. Good luck!

What part of austin?

Buda....So technically a little south of Austin.

Really appreciate all the feedback. I have shared much of it with my Dad and made my case very clearly.

Not sure which way he's gonna go yet but I have done all that I can to steer him to a wise decision. My conscience will be clear if he moves forward with this and it backfires down the road.

I have the buyer's name now. Not comfortable posting it here publicly and would ask that it not be shared but if anyone has a means to do any kind of lookup or diligence please PM me.

Gig Em!

Diggity said:

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no kidding...the fact that they gave no warning that this might be an issue until the day of closing if completely ridiculous.

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This is what I based the majority of my argument to Dad on. There is no logical explanation for this going to the finish line without any warning. Instead, they move out of their house and are in a significantly weekend position and more likely to consider undesirable alternatives.

McKinney Ag said:

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Buda....So technically a little south of Austin.

Really appreciate all the feedback. I have shared much of it with my Dad and made my case very clearly.

Not sure which way he's gonna go yet but I have done all that I can to steer him to a wise decision. My conscience will be clear if he moves forward with this and it backfires down the road.

I have the buyer's name now. Not comfortable posting it here publicly and would ask that it not be shared but if anyone has a means to do any kind of lookup or diligence please PM me.

Gig Em!

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If you want to find out the status of his real estate license, you should be able to check it at trec.gov easily. It would also show who his sponsoring broker is and you can contact them if you see fit. If you want to file an ethics complaint, you should be able to do that through TAR (Texas Association of Realtors). If he's not licensed in Texas, you can probably do a search through NAR's website but I'm not 100% sure.

Outside of that I don't have any other resources, personally. I really hope this all works out for your family.

Another real estate professional here chiming in that they absolutely should not let these people move in. They need to terminate the contract and put it back on the market. They can do so as politely as possible in the event these people actually are legit, they can re-engage once they have funds/financing worked out, but this screams professional scam.

I agree that they made the right decision. As for a referral, I know and have used Diane White. I know others will have recommendations, but I think she should be a realtor you interview.

http://www.dianewhiterealtor.com

I hope the process from here on out is a smooth one for them.

I thought there was a sponsor on here somewhere that was a low cost or fixed fee realtor. I can't remember the company though

edit to add the sponsor I was thinking of...
https://www.myredpear.com/

Thank you. I reached out to him.

Any updates?