Seller committed fraud?

This is a discussion on Seller committed fraud? within the Buying & Selling Property forum, part of the REAL ESTATE & PROPERTY LAW category; I just purchased a 3 family in Massachusetts. I passed papers last week. The property was advertised with rental figures ...

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Old Jan 5th, 2009, 07:32 AM   #1
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Default Seller committed fraud?

I just purchased a 3 family in Massachusetts. I passed papers last week. The property was advertised with rental figures of $750 and $400. I asked my realtor to verify the info, he in turn contacted the listing agent for information, though they were unable to produce the actual receipts because the seller had packed her personal papers, those figures are part of my P&S. When I went to collect the rent the tenant told me he was only paying $600 a month and had receipts to prove it BUT he hadn't paid rent since Oct because he failed to complete his community service and lost his welfare check. I would have NEVER purchased the property had I known tenant was on public assistance, behind on the rent and only paying $600 a month. This investment was supposed to be cash neutral, and is now costing me money to own the property. When I found out about the rent, I contacted my realtor who in turn contacted the listing agent. The listing agent put a stop payment on a check that they issued to the seller for about $4k. If the check hasn't cleared, they are willing to give me that portion of the seller's profit. The money will help me pay the portion of the mortgage that I now have to take out of pocket and will help with the cost of eviciting the tenant. I just don't know if $4k is worth the problems I'm facing.

Since the seller committed fraud, doesn't that invalidate the transaction? I'm wondering what I can do to get out of the sale? How would I go about prosecuting the seller, I have no info other than her name. What liability does the sellers agent have in all this, had they done their due dilligence, I wouldn't be in this predicament?

Any help would be greatly appreciated?
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