Fri 3 Aug, 2007 06:45 pm
I bought a lot w/ some one else and he swore it would be a quit flip, short term. That was over 2 years ago, it's depreciated $100k in value, and I'm already out $43,000 on it. He indicated the payments would be doubling in a few months and he's close to bankruptcy. I found on public record where he's acquire more property and has around $3mill in mortgages. He doesn't make a ton of money. I decided, for the best interest of my finances and family, to send him a letter stating I was no longer making payments on it. I am not on the loan/note, only on title. He is now threatening to sue me for breach of "agreement". Can he get away with it?
are you saying that both of your names are on the title?
Can he get away wityh it? Maybe! Anything CAN happen....
Real Etste transactions are almost always required to be in writing to be enforceable though. You need to talk to a real estate lawyer in your state and get advise on how things of this sort are handled where you live (there are different laws and processes in evry state).
we are both on title,
he is the only one on the loan
Your agreement may not be enforceable because it may violate the Statute of Frauds, but that just means that your partner can't sue you to enforce the terms of the agreement. He can, however, still file suit against you in chancery. In that kind of suit, the court doesn't try to enforce the unenforceable agreement, it just attempts to see that a fair result is achieved. And I'd guess that a court wouldn't think it was very fair of you to stop paying on the loan, especially since you apparently thought you had an enforceable agreement when things were looking good.
Bottom line: you got yourself involved in a business deal with someone who proved to be a bad risk and you didn't get the deal in writing. I'd suggest you see a lawyer, but that advice is about two years too late here. Next time, consult a lawyer before you dig yourself a hole so deep that you can't get out of it.