seller file for bankruptcy help

[Zocky Zhang]

my church is buying a property in MD. 

currently the property is leased to a senior care operator, owner collect 6k rent each month. it has been going for 15 years.
15 years ago owner bought the property with grant from MD State, state said if owner sell to non senior care business within in 30 years, owner need to pay back 500k. now owner still owe banks total 600k.

owner accept our offer in mid july with agreement of sale signed, no contingency on grant waived. He said he will ask MD State to waive the grant, however the grant will not be waived by State. Now owner want to file bankruptcy after realizing sale price is less than state grant and bank loan balance.

will this grant be passed to buyers? shall we sue the owner or someone to carry out this deal without an real estate lawyer?

[Tom Gimer]

Post the property address and/or the actual documents... it's the only way to get real help. Without those facts we can only speculate -- to me it appears the seller cannot deliver marketable title so the deal likely dies.

In Maryland grants are typically junior liens with a balance that eventually phases out to $0 over a period of years of ownership. The deed of trust often includes the terms agreed to in the note, so these terms could be public record. Sounds like the seller either doesn't remember the terms or failed to read the paperwork.