Perma-Squatters

by Jim the Realtor | Mar 22, 2021 | 2021, Real Estate Investing

Thanks to the many folks who sent in this article about a seller who stayed in his house after escrow closed. In this raging market, it is customary for listing agents to suggest seller rentbacks as one of the sweeteners to get an offer accepted, and will deliver a nice rental agreement but if the sellers don’t move, what are you going to do? In the more affluent areas, a lawyer’s monthly retainer fee is less than the rent, so the squatter can delay until you pay enough lawyer fees to reach a deal – and it probably won’t include paying the back rent. I know of one landlord who hasn’t received one penny of his $5,000+ rent since covid started!

RIVERSIDE, Calif. – When Tracie and Myles Albert purchased a beautiful four-bedroom house in Riverside, California they never realized that at the end of escrow the seller would suddenly refuse to give up the keys and leave.

“It’s just draining, emotionally and financially,” says Tracie.  On January 31, 2020, the couple purchased the home. More than a year later, they still haven’t been able get inside their property. Chris Taylor is the Real Estate Agent who sold the house to the Alberts from a man who wanted to sell immediately.

“He needed $560,000 from the sale of his house in two weeks and he called me on a Sunday, so in traditional real estate there’s no way of doing that unless the buyer’s a cash buyer,” says Taylor.

Since the house was free and clear and worth more than $560,000 the Alberts felt it was a great deal.

“It took us scrambling to get everything we had, our life savings put together and a hard money loan on top of it to make that happen,” Myles stated.

During escrow they discovered there was a $30,000 tax lien on the house which slowed things down, but in the end, all parties signed on the dotted line and the sale was completed.

“We own the house, outright. That’s our house and it’s all in a contract, written, legal, done. He’s been paid the money in his account. How could we have no rights to go into our home,” asked Myles.

Taylor says, “It’s genuinely unfathomable to me that we live in a state where something like this is even possible. They closed escrow on this home January 31, 2020.”  The Alberts and Taylor have contacted authorities and tried to get the seller evicted but because of the pandemic, they’ve gotten nowhere.

“They have this case under a COVID tenant situation, of no evictions when it doesn’t fall under that at all. This transaction went through in January 2020 before any of that, it isn’t a renter who was getting thrown out. It’s the guy who collected all of this money,” stated Myles.

Eviction Attorney Dennis Block says, “This year alone, we’ve handled at least 7 maybe 8 cases of this exact type of situation.”

He says people purchasing homes need to be extremely cautious, especially if they notice any red flags during the process. Block says what’s happening to the Alberts could happen to anyone.

“This person is not a tenant, it’s a previous owner who is enjoying the benefits of the money that was transferred to his account but of course doesn’t want to move out of the premises that he no longer owns,” Block stated.

The Alberts filed an unlawful detainer but because of the California eviction moratorium, the case has been stalled. Time is simply passing by and the immaculate house they fell in love with is now becoming an eyesore.

Tracie says, “I tried watering the lawn one time and he came out and ripped my sprinkler lines, ripped all the wires. The Palm trees are dying, everything was beautiful and everything is dying.”

Her frustrated husband says when he contacted law enforcement, they told him, “If you were in Arizona, if you were in Nevada, this wouldn’t be a problem, you would just go take your house back. But in California, like our hands are tied, even though we’re on your side, there’s nothing we can do.”

https://www.foxla.com/news/couple-buys-riverside-dream-home-but-seller-refuses-to-move-out-in-eviction-moratorium-loophole