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Commerical Real Estate Sale Questions

Discussion in 'Commercial Transactions & Investments' started by Siberian444, May 8, 2016.

  1. Siberian444

    Siberian444 Law Topic Starter Guest

    Jurisdiction:
    Georgia
    We are confused with the sale of a commercial property that was completed. The contractor was apparently paid using credits they owed the property manager company ($40,000) based on a deal they had worked out. So the contractor is not getting any money for work completed on this project at all. However, the seller used the contractors invoice ($50,000) for the sale of the property at the full amount with no mention of credits and had contractor fill out waiver for the $50,000 price. They also presented the buyer with a check made out to the contractor ($50,000) for the total of the original invoice. The check was never given to the contractor and was only used to close the sale. We are trying to figure out if this is a normal practice for the sale of a property. Or do we need to dig deeper and get more info? It just seems off to do all of that. Wouldn't it be easier to have an invoice for $40,000 and list the $40,000 in credits, so it washes out to zero? And why would the wavier be needed if the contractor wasn't being paid due to credits owed? I appreciate any help you may have, as this is confusing to us. Does the contractor have to remove the lien since the total is not exact due to credits? The contractor filed a lien for $50,000.
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    Siberian444 likes this.
  2. adjusterjack

    adjusterjack Super Moderator

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    I have no idea what you are talking about or what the "contractor" and his credit has to do with anything.

    If you are the buyer or the seller in this deal and escrow has been closed, it's a little late to be asking about it, especially since you appear to be clueless as to what happened.

    I suggest you take your purchase contract, escrow papers, closing documents and deed to a real estate attorney and get this explained to you after a thorough review.
     
    Michael Wechsler likes this.
  3. Michael Wechsler

    Michael Wechsler Administrator Staff Member

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    It sounds like a $50,000 check was cut and then endorsed or voided and that an under the table payment was made by a property manager to a contractor and an invoice used as if the transaction didn't really take place. How this would all be known to someone else is beyond me but if none of this smells kosher, then one has to wonder why someone at the closing didn't speak up before the real estate transaction was closed. One has to guess that there is a great deal not shared here and that there is a tremendous amount of confusion.
     
  4. army judge

    army judge Super Moderator

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    The one thing you know is someone has filed a lien against the property.

    A lien is generally of more concern when the owner is trying to sell a property.

    However, you appear to have purchased this property only to discover a lien after closing.

    There could be many unknown events behind the lien.

    I'd endeavor to understand the lien.

    It could be that the person filing the lien did so illicitly.

    For your enlightenment:

    Liens Against Your Home | Georgia Department of Law's Consumer Protection Unit

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    Georgia Lien Law Summary - State Laws - Construction Liens
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    http://www.troutmansanders.com/file...resentation/File/TS-Construction_AGCPaper.pdf
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