Seller Financing gone wrong? Any attorneys here?

[Verna Medlin]

This is going to sound like a bad soap opera, but here goes...

What happens if you have a property sold on seller financing and the buyer uses it as a rental. BUT... the buyer turns out to be a slumlord who is allowing the property to deteriorate so bad that the house will soon be unlivable?  (Broken windows, heater broken, leaking water pipes, electrical problems, holes in walls, rotting porch, among other damages.)

The buyer continues to make payments, but if they stop then you have a ton of repairs before you can rent out the house. And I have the disadvantage of living in another state. 

So my question is How do you handle a situation when it's obvious that the buyer is not keeping the maintenance up on the property?

I wanted to foreclose a couple years ago but was told I can't foreclose as long as payments are being made. Is damages a reason to foreclose? How about constantly late payments? (only 2 or 3 weeks late, not accumulated months.)  Behind on property tax? (almost lost it to a tax sale because the buyer did not pay the property tax for 3 years!)

The house is in Missouri. The deed is in my name. My ex made this contract behind my back when we were negotiating a divorce, (he knew I was getting the property in the divorce). I never signed the contract (my name was on the deed at the time). The contract is for less than half the value of the home at the time it was signed (I'm pretty sure ex did that on purpose in retaliation for me winning the house in the divorce).  Am I still obligated to honor that contract? I was under the impression that the "buyer" was a property manager until last week when I found out he has this contract and is claiming to own the house.

I know this is a lot and I need to see a real estate / contract lawyer, but I simply can't afford to go that route. I'm in my 70s living on social security income plus the small property payments I'm getting on the house. (No sympathy please, this is simply the facts.)

Oh, and the current tenant in the house thinks they are buying it from the buyer. AND my buyer tried to sell of part of the lot for cash. (no idea how he intended to supply a deed for that!) That is also a problem that needs to be dealt with. In addition, the "buyer" is the county sheriff so in essence, I'm fighting a battle with a local cop while I'm the outsider! 

I know this sounds unreal, but I swear, every word is solid gold true. 

[Jay Hinrichs]

Quote from @Chris Seveney:

@Verna Medlin

Go to a lawyer as if you are not on the contract but on the deed it is an invalid contract - BUT if you are accepting payments then they have a claim against both of you

Your attorney will probably say return all the $ collected if you want out of the deal or clean up the paperwork and make it a legit deal. Cannot have your cake and eat it too (take the payments but then say invalid contract)

If it’s a contract for deed (which sucks in Missouri as it would have been faster to have a traditional deed of trust and note), it may state they are responsible for upkeep of the property

But if there are no violations and they are making payments you will have a difficult argument to take property back

As mentioned get an attorney

depending on the debt instrument used virtually all of them have what is called  EVENTS of DEFAULT.

These include:

Non payment of mortgage when due.

Non payment of Tax's and or insurance.

WASTE  and that is what you have if you can easily prove it.. You can start a foreclosure for waste.

Its a pretty rare instance this  happens but it is in most debt instruments.. All the other he said she said about the deal is something a lawyer would have to suss out..  I have a really good lawyer in KC market that just did a complicated quiet title action for me and we won and she got it done in record time for a Record Low price for us.. Happy to make a referral..