Inherited tenants claiming rent to own status

[Andre Jones]

Good evening 

I'm getting ready to start the probate process for my father's estate and I spoke with two of his "tenants" who are claiming they had some rent to own or lease purchase agreement with him prior to his passing. My father had mentioned in conversation that one of his tenants had defaulted on a rent to own a few years ago but he never told me specifically who it was. 

I haven't been able to find any paperwork verifying their claims from my end and I asked for a copy of their agreement and was told they needed to find it. When I pressed for more information, they were kind of stand-offish and stuttering. My instincts tell me they are lying but I want to cover my butt as well. 

Is this type of thing common when homeowners pass away? If they are valid, do I have to honor this agreement since it's not a "lease"? If they were late or missed a payment say in March, could I still default them on the contract now in August? 

[Joe Splitrock]

If your father has a history of "rent to own" agreements and two tenants claim they have such agreements, I would take it seriously. Verbal agreements are legally binding, but without written evidence it may be hard to prove. Does your father have any documentation for these properties? Even if he had a standard lease, that could indicate they were not "rent to own". 

I would also review bank records for history of deposits. A rent to own contract is usually initiated by a larger upfront payment, versus a standard lease has just a security deposit. For example a property renting for $1000 per month would have a $1000 deposit. The rent to own down payment may be $5000 or more. 

Look through all his paperwork. Even if it is not rent to own, there should be lease agreements or some documentation. This is not common when owners pass away, because most people keep good records. Don't use your fathers sloppy paperwork as an excuse to defraud the tenants out of something that they agreed to in good faith. If there is a contract or agreement, it goes with the property, even though he has passed.