If my tenants wanted to buy the rental and decided to put substantial money intoit with my permission before closing, am I obligated to reimburse them?

This went as far as a legal purchase and sales agreement. They were then denied a mortgage with documentation from their lawyer. They now want to be reimbursed for the money they put into the house. I gave them permission to do this work but never said I was going to reimburse them. In fact their is no written agreement at all. They now refuse to pay rent. Do they have a case?

Asked on July 14, 2010 under Real Estate Law, Massachusetts

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Property law in the state of Massachusetts is different from other states.  Often general rules that apply in property law come with the disclaimer: "but not in Massachusetts."  Therefore, I think that it would be best for you to seek help from an attorney in your area as the stakes here are high if the improvements were substantial. I would first direct you to your lease and the purchase agreement and see if either addresses the matter.  Were the improvements done under the lease or purchase agreement? These are questions to be answered by your attorney.  You will have to deal with bringing an action in Landlord Tenant Court if the purchase agreement is now void.  Good luck. 


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