Greetings! . First I will say that the story I present to you here is not one of the Cinderella stories most of the time…
Greetings! . First, I will say that the story I present to you here is not one of the Cinderella stories we usually hear here (and I wish we would only hear them)
Introduced to you the turn of events in the deal. We entered into a deal in December 2018 in Atlanta USA, a new construction. The nature of the transaction was conducted so that we are the capital investors through an Israeli liaison company with an American llc company. The American brings the loan on his credit and the contractor builds at a supposed cost price and profits are split 33% per side. The construction was supposed to be in order and the house was already in the process of being completed, but suddenly we were told that the contractor had stopped the works. It turned out that the construction cost he himself signed was low at nearly $ 15 from the market price, and in fact he couldn't keep up with it.
Then the jobs and money from the loan were over and it was necessary to bring another $ 3500 out of pocket which of course came from us. We were told that the money goes towards paying the interest to the lender before he forecloses the house. All the time we got the feeling that this is the one after that we are running to the end of the deal and we are indeed a buyer. While we wanted to get an account from the contractor who signed us a work contract that says he has 120 days to build and every day he has to pay $ 100.
We were told to leave it and that it was most important to sell fast and move on. After about two weeks when we were already under contract with the buyer after we pressed the contractor to take responsibility for the mess, the US investor claimed that he had come to terms with the contractor for a lesson that he was giving up the profits from the deal against the late schedule. We wanted contractual proof of that and we did. But after reading the contract, we found out that, although the contractor was out of the deal, what they did not tell us was that there are lines on the house called the subcontractors and the contract relieves the main contractor of all these obligations. That is, the payments made by the prime contractor to the subcontractors became lines on the house, meaning the debt became our investor debt. The American investor acted in a clear conflict of interest since instead of making money from the contract we went out of debt. Although we found a buyer for the house, it has a line of 26k of subcontractor and another 30k that must be added to another subcontractor. The 30k is not under Lin because the US investor signed the unreasonable contract below.
And that is not the end, a week ago we first discovered that the house is unfinished at all and has another 15k work that needs to be completed before the sale, and it needs to be completed out of pocket. Then it became clear that the garage door was stolen which added to the costs of 18k. We are at a loss of at least 50 percent of our investment.
Currently the loan is open, the house is unfinished, but some buyers are ready to make a deal if the home is completed.
I will just point out that, in terms of contract, we have done a lot of squabbles and the power is not really in our hands but in the hands of the llc company that is supposed to represent our interests.
We would love to hear opinions and suggestions on how you would operate in such a situation.
And how, perhaps, to complete the deal and minimize damages.
Responses