If owner financing a home, is a handshake and an oral agreement binding? 2 Answers as of February 24, 2014

We have paperwork showing the terms of the mortgage, which both parties initialed, but the written contract was returned to the owner of the home to be amended. That contract was never returned to the buyer. In the meantime, the buyer continued to make payments over the amount agreed upon for the monthly payment. Unbeknownst to the buyer, the owner took at least 2 loans out on the home and defaulted on the second loan. What rights does the buyer have to keep the home?

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Stuart P Gelberg
Stuart P Gelberg | Stuart P Gelberg
Not a landlord tenant Q. No: see Statute of Frauds. Is this even in NYS?
Answer Applies to: New York
Replied: 2/24/2014
Peters Law, PLLC
Peters Law, PLLC | Mark T. Peters, Sr.
Without it being recorded before the second loan was taken out, you have the right to pay off the second loan and take the lender's position on the foreclosure. Of course, you would then have to pay on the first mortgage, but it might be end up being cheaper in the long run. You might even be able to sue for the amount you paid previously, but if he can't afford to pay the loans, he probably doesn't have anything to pay you.
Answer Applies to: Idaho
Replied: 2/24/2014
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