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When seniors buy condo together, problems can pass from one to another
By Edith Lank | Columnist
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Published: 6/26/2010 11:00 PM

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Q. My friend and I purchased a condo together. She was self-employed and I was retired. She has since run into trouble with the IRS and one company. They placed liens on her share of the property. We put the condo on the market for sale and have had contracts terminated twice now. The parties holding the liens won't lift the liens to let the sale proceed. She can't keep up with her portion of our arrangement, and I'm being forced to pay part of her share. I'm caught in the middle and desperate to find an answer. Is there a way to proceed with the sale having her portion garnisheed and put into an escrow account?

A. You could sell if you'd get enough cash out of a sale to pay off the liens. If so, that could all be handled at the closing. But my guess is that there isn't enough equity to cover that or you don't want your share going to pay her debts. There's no harm in talking with a real estate attorney to see if there's any way to solve the problem, perhaps by negotiating with her creditors. But mostly, though, that's what happens when you buy with another person. Your investment becomes vulnerable to your partner's problems. I think you're pretty much stuck.

I read your article about a person having a share of property and she wanted out. I have a similar situation and would like to know what attorney handled her case, where it was located, or who you would advise me to contact to see if I could also file a partition.

A. Except when property is owned by husband and wife (and sometimes even then), any co-owner can ask a court to order partition. Where possible, that might be actual splitting into separate parcels. More commonly, it's sale of the property and division of the proceeds. This involves a public auction for immediate cash and isn't likely to bring true market value. But if you want to try it, any attorney should know how to help you.

We were renting a house and paying an extra $100 a month to be saved toward buying it. That was two years ago, and we made all the payments on time. The agreement was that if we decided not to go ahead and buy, the extra money would be returned. Now, we need to leave town for a new job and the owner won't return our $2,000. Is there anything we can do?

A. I sure hope this agreement was in writing. Do you have a contract saying you'll get your down payment money back if you decide not to buy? If not, you may be out of luck. Oral agreements don't count for much where the sale of real estate is concerned. But whether there was a written contract or not, you can always go to small claims court. You can tell your story to a judge and see what he or she rules. It's a simple procedure that doesn't cost much, and you have nothing to lose.

My credit score is 670 and I have two credit union accounts. I am interested in buying a home. How do I compete and end up with a fixed rate of 2 percent or 3 percent?

A. No way that I know of. Interest rates are still a really good bargain, but recently they run something more than 5 percent on fixed-rate loans.

We signed a "P & S" to sell our house, closing in two months. We changed our minds. Can we back out of this deal?

A. That "P & S" is evidently shorthand in your area for a "purchase-and-sale contract." The important word there is "contract." When you signed, you made a binding promise to sell. You are legally bound to do so. Backing out could cost you money, and at the least cause a lot of fuss. Theoretically, the would-be buyers could even go to court and ask for "specific performance," forcing you to sell. That's rarely done, of course. On the other hand, I don't know the provisions of your contract and whether you have any allowable reason for voiding the deal. It's time to consult a lawyer - preferably one who specializes in real estate - to see if the document has any escape clause you could use.

• Edith Lank will respond to questions sent to her at 240 Hemingway Drive, Rochester, N.Y. 14620 (please include a stamped return envelope), or readers may e-mail her at

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