Don’t deal with relatives
Chronology of Spring City house and Christensens
Ray Christensen is my father’s cousin by virtue of their having mothers who were sisters (Sarah and Viola Patterson) in Bloomington, Idaho. Marilyn, his wife, is thankfully not a blood relative.
October 2003 – Marilyn calls and says she had a dream that they should buy my house. No mention of bankruptcy at first. Later call mentions bankruptcy, too much debt on house from remodeling. At the time I have rented it to Brad and Johanna Wynn. Brad is a vice president of Snow College and is building a home in Ephraim. I have been talking loosely about maybe wanting to sell the house
I agree to sell it for $190,000 (the same amount I paid for it in 1999) which is $22,000 less than the current appraised value. Because of their bankruptcy I agree to sell on contract with a balloon payment in two years and no down payment.
Before signing any documents Marilyn tells the Wynn family that they have to move out by her deadline to move in. She wants to be out of her old house so someone else can move in it.
Nov. Closing on house is done at D-Land title company in Manti with Merrill Ogden.
I ask them about workbench in sun room and they say I can leave it, they’ll use it. A week or two later I see that it’s gone, moved to the yard. I let Bruce Russell take it and we can’t find all the leg parts.
November 2004 – I ask the Christensens about the financing, since they said they would try to finance after one year. They say it hasn’t been a year since their bankruptcy. They filed in December after buying the house from me. They had told me they were filing before buying my house. I had talked to Darren Miller of Pleasant Creek Mortgage who said he could help them after one year but they didn’t want to deal with him.
Fall of 2005 – Ray and Marilyn have been trying to get financing and I’ve had to fax some documents of the sale to a mortgage company in Las Vegas. Earlier in the year, January or so, they sent all their original documents to a company in Provo and they put the wrong address on the envelope at it was all lost. I had to give them copies which they sent again to the company but still kept no originals.
Thanksgiving, 2005. I’m at Barbara’s in Lafayette, Indiana,and get a call from Marilyn saying they’ve decided not to buy the house after all. She offers a deal that they sell it and give me a third of the profit. Stunned silence on my part. Next week I’m back home and see attorney Richard Musick about the problem and he writes a letter to them explaining the legal situation. The situation is that if they default they get nothing. I take it to the Christensens and agree to meet with them and their son Craig to talk (they always mention that Craig went to Harvard. Sometimes they tell people he’s a lawyer but he’s not). I emphasize before leaving that they should reconsider and take out the loan to fulfill their contract. They say they now have good credit and would have no problem getting a loan but that they just want to get a smaller house. They’ve had some problems, including Ray’s health and loss of life insurance. He has diabetes, heart trouble, and some memory loss. Ray is about 77 and exhibiting early signs of Alzheimer’s. At this time Ray gives me a check for the regular monthly payment amount, $1514.00.
In the meeting with them and Craig we discuss how they could get some of their investment in the house back if I sell it. They have said, in different conversations, that they’ve put $10,000 or $15,000 or $20,000 into the house and landscaping. I offer some options of my own to try to meet their wants and we meet again in a couple of days and agree to the written form as it’s signed at that time. That agreement includes giving them a fee for selling the house if they can during the next seven months (probably illegal since they’re not realtors), half the profit if it sells for more than a base price of $185,000 (what they owed at the conclusion of the contract), and rent of $850 while they stay there before selling the house. They were paying $1514 on the contract. The base price of $185,000 is to increase each month by $300 since I am paying about that much more to my mortgage company than their rent. The increase is to begin in February rather than January so I will be absorbing some of the cost of the appraisal they had done when trying to finance in the fall of 2005.
About January 1, 2006 – Marilyn calls to say that since they now pay $850 a month for rent and that they paid $1514 in December (the end of November) they should now only owe $186 for January’s rent. Once again I’m too surprised to argue. This makes the agreement retroactive to Dec. 1, even though the agreement was signed Dec. 5. The house payment was made on the first, before they had decided for sure to default.
March – While jogging in Provo I get a phone call from a realtor in Spring City named Lyman Compton who says that Marilyn contacted him about listing the house. He says he did a check on the property on the tax rolls and found that I was the owner. Marilyn had not told him she didn’t own the house. I told him I had an agreement with them that they could represent me until June and said if he wanted to call her and she agreed that I could work with him. He said a few days later that he didn’t want to get involved.
May 1st 2006 – Marilyn wants to talk about the house. She says they have someone interested and they’ve told him he has to pay the unalterable price of $242,000 which is $22,000 over the appraisal they had done when looking into refinancing in the fall of 2005. They say the person could put $40,000 down which they would take and I would get paid in November after the buyers sell some property. They also say the person has been calling on them every day for two weeks. Their son Craig told them not to tell me about this plan. I tell them that they don’t have the right to say the price is nonnegotiable, that I have the right to set the price. I tell them that the $40,000 is more than they get and I calculate based on memory what it would be and tell them it’s about $34,000 if there are no other costs. On refiguring at home after checking our agreement I find it’s $33,450. I also tell them that I’ve sold my Wales property and that I’ve paid back my father most of the down payment I borrowed from him and that the pressure to sell is diminished for me. When I first put the house up for sale I also decided to sell the Wales property and had decided at that time that if I sold one I would take the other off the market.
They want the house to be sold for $52,000 more than I sold it to them for, and they want to make sure they get $40,000 so they can move into a new place.
When they bought the house I let them take the riding mower, weed trimmer, and power push mower with the house. Marilyn was going to pay for the power mower but I don’t think I ever got anything.
May 4th 2006 – I called Marilyn about working on the sprinklers but the water hasn’t been turned on yet. She asks about getting a realtor and I tell her I already have an agreement with Lawny Hunt when their time expires to represent the house. Marilyn says “She’s so poor. She’s not aggressive at all.” I tell her Lawny just sold my Wales property.
During their ownership of the house the interest rates on loans hit a record low around five percent. I missed the chance to refinance at that rate and if I continue paying on the current loan will pay about $30,000 more over its life. Therefore:
Sidebar: Proposal to the Christensens: Because of the fact that I sold the house for 190,000 when it was appraised for $212,000 and it was appraised for $220,000 after they decided to default the increase while they owned it was $8000. I gave them a $22,000 discount. Some of this was due to the improved market while they were in it, not just their improvements. I’ll say they improved it about $6000. At the same time they missed the deadline to sell before I became liable for capital gains tax on my profit. This tax could be up to $8000. Because of mismanagement of the selling process they deserve no commission. My gain from the process of selling to them would be the $6000 and my loss would be $22,000 plus $8000 plus $30,000 or $60,000. We should renegotiate the agreement to sell by basing the price on $212,000 instead of $185,000. The commission should be omitted. The Christensens should pay $8000 from their profit after the sale toward my capital gains tax. Their profit should be capped at $6000, the increase in value from their occupancy. They should also pay half of the increased interest to me, or $15,000. This means they owe a net of $17,000 toward my expenses on top of the amount I receive from the sale.
May 9 – I call Ray and tell him I’ve decided not to sell the house. He says “talk to Marilyn.” I tell her it’s because of passing the deadline on the capital gains tax and selling the Wales property. She says she’s going to talk to her son and hangs up.
May 11th phone calls with Marilyn
First I talked to my lawyer for his opinion on the “contract”. I told him I’d taken the house off the market and he didn’t think that was breaking the agreement but he recommended that I talk to them and give them the full benefit of it by letting them try until the end of June to sell the house. He also told me about the capital gains tax and it wouldn’t be as much as I feared. So, I called Marilyn and she opened by saying “who are you and what have you done with Paul?” I said I didn’t know what she meant by that. She said she’d never seen me like I was last Tuesday. Whatever could have prompted me to go back on my word and break our agreement? I started by pointing out what I’d done for them from the beginning but Marilyn was offended by my lack of appreciation for what she’d done for me by leaving me a house I could make a lot of money on. I certainly get a new perspective from talking to her. I mentioned a few little things like her raising the price but apparently I was mistaken, she told me from the beginning what she was doing, although I don’t remember it that way. Then she asked what the big deal was, she was only trying to make me some money. When I pointed out the deadline for tax she pointed out that she couldn’t have known that. I was so persistent in trying to unjustly persecute her that she told me to grow up and then she hung up on me. I called back and told her to stop acting that way and she said I’d accused her of being immature. I once again was corrected because I had thought she was the one who said it. My memory is so bad, and it can only be the moon doing it to me. I mentioned that I had heard second hand that she’d told the potential customer that I was hard to deal with. She responded “You are hard to deal with!” I was also corrected when I pointed out that the house had been for sale for 5 1/2 months. She said it had only been for sale for three weeks, since they put the sign out, because they wanted to make sure it was presentable. Some people, myself included, remember the sign being put up in December, then taken down for a couple of weeks in February or so due to some deal she was trying to cook up with a realtor without telling me, but our memories must be wrong. I’ve learned to give people more of the benefit of the doubt. I should have learned years ago that people only have my interest at heart but my mean spirit has kept me from progressing. I said since she thought I was breaking the contract that I would abide by it and give them the rest of their time. She then asked if they could get a 6 week extension to use a realtor and I just said no. I don’t know what it is that makes me so unsympathetic. I hope I live long enough to repent and do better. After she told me that her decisions regarding the house were made as a family with honesty, integrity and prayer I asked her how defaulting squared with integrity. The best I could do was wish her good luck. She called back a few minutes later to apologize and I did as well. Then she told me that she’d only told one person that she didn’t own the house. I tried to talk her into telling interested people that she wasn’t the owner. I’m sure she knows best.
May 22nd – I went over to work on the sprinkler system and found a number of problems including a broken line near the front porch where the person digging a trench for the gas line to the stove had cut through the sprinkler line. I also found that the trampoline in back was still there, contrary to what Marilyn had said when I gave her a letter from the insurance company a few months back stating trampolines were excluded from coverage. She told me that wasn’t an issue because they had gotten rid of it.
May 30 – George Olson and his wife came in the shop to talk about the house. This is the first time I’ve met them and the first time anyone has talked to me face to face since the house went up for sale Dec. 5. I explained the entire situation. They had some insights about their encounters with the Christensens. They said the Christensens told them that they wouldn’t accept a penny under $242,000 for the house and that there was no point in talking to me. I was hard to deal with and unreasonable. The Christensens told them that I had been so completely unreasonable when they defaulted that they had to get their son in to mediate. They also told the Olsons that there was no appraisal on the house and that there couldn’t be one because there were no comparable homes. Marilyn also said they had made double payments on the house and they had put $30,000 into improvements. They didn’t mention that I was related. I mention to the Olsons that they need to be aware of the history of the Christensens in their former house and make sure there is an inventory of things that would stay if they decide to buy at some point. The Olsons said Marilyn had told them they already had their lot and the modular home they are getting would be ready in a couple of weeks. Marilyn told them they could be out of the house by the end of May if they wanted to buy at that time (early May). The Olsons mentioned one big concern they had which is that if they bought the house and the Christensens went through with their plans for the modular home they would all be in the same ward. The Olsons were concerned about bad feelings if they bought the house directly from me.
The Christensens had lived in Spring City before their bankruptcy and when they left the previous house they took a lot of things with them that are considered fixtures, among them shutters for the outside of the windows which they applied to my house. I didn’t know their origin at the time. I was told they also removed a water heater and replaced it with a non-functioning one. The house had to be sold at a big discount and John Black, another friend of mine, bought it from the bank.
May 31 – I visited for an hour with my attorney, Richard Musick. He pointed out a couple of things in the agreement I have with the Christensens to sell the house. I had considered the 50% profit going to them to be a continued part of the contract for its 18 month life, however, Richard noted that it seems to expire with their right to act as agents on June 30. He also noted that there is no mention of any commission to them if anyone they have dealt with decides to buy the house after that time. In other words, if the Olsons made an offer after June 30 there would be no obligation to give the commission to the Christensens. The Olsons had made a point of saying that if they were not prepared to offer $242,000 they could not talk any more and they felt that they were turned away.
April 22, 2007 Epilogue:
The Olsons bought the house for $212,000 and moved in in July 2006. The Christensens moved 4 blocks away to their new modular home. I helped them move. In the process I was at the house when a man they’d hired came over to remove ceiling fans. We discouraged him although there had already been a number of things taken that shouldn’t have. I managed to keep the riding mower for the Olsons. I told Marilyn that I had promised it to them. She thought they could give the house back but keep the mower. They had taken it to Ephraim to get it sharpened and it had fallen off the trailer in Pigeon Hollow and gone into the sagebrush, damaging it to the extent of about $600. At that time they were renting from me and they had to pay for the repairs but they also thought they were going to be able to keep it. Also, while moving them, we found that their new house was about half the size of mine and we ended up making a huge pile of stuff in the dirt that wouldn’t fit either in the house or the garage. One entire trailer load was Christmas ornaments. Another several loads were old food storage.
After the finances were finalized I paid the Christensens about $8600 from the profit that was beyond their obligation from a year earlier. I felt that I was not obligated legally but had promised in a way so I did it. My share was pretty much used up renting cabins in Sundance for my father’s 90th birthday celebration, which was attended by all my siblings and spouses and all our children and grandchildren except one. It was a great time up there for more than a week. We also had a dinner which was attended by many of my father’s friends and colleagues and two of his three living siblings and many of their family members.
I had been singing in a barbershop quartet with Ray and two other Spring City friends, one of whom had been Ray’s friend for 50 years. After selling the house I quit the quartet and have tried not to see Ray again with pretty good success. The bass in the quartet, Boyd, had called me when Ray was packing up things in my house to tell me that Ray had asked him to go over and help remove ceiling fans and thought I should know about it. He was quite understanding that I didn’t want to be around Ray any more, as was Gary, the other quartet member. I came away with some memories not to be forgotten because of the lessons embedded in them. I figure I didn’t lose more than fifty or sixty thousand in the deal.
