What to expect when dad sold me a foreclosed house and now threatens legal action?

Question

In July, my dad sold his house to me while it was in active foreclosure. We agreed he would receive $20,000 from my husband and me. He signed papers confirming he would wire transfer us our money, with the rest of the proceeds going to him. Earlier, while he was in the hospital, he told me to Zelle myself money he owed me, totaling about $5,000. Now he's threatening to involve an attorney. Everything was done legally, with the deed recorded and all paperwork signed by him. The agreement was mainly verbal, but I have two witnesses. No formal legal notices have been received yet. What should I expect next, and how can I protect my family in this situation?

Leonard R. Boyer · Answer

Your situation will require a consultation with an experienced foreclosure defense and civil litigation attorney to review all documents and whatever other facts that you have. You should expect to pay $300 for the consultation. The attorney will then be able to advise you of all your options and how to best proceed.  Pick the best attorney you can find and remember one rule:  a good attorney is generally never cheap, and a cheap attorney is generally never good so don't choose based on price. With modern technology, you can be represented by any high-quality attorney in New Jersey irrespective of geography.

James L. Arrasmith · Answer

From what you’ve described, this looks like a civil disagreement over money rather than anything criminal. Since the deed has been recorded in your name and the paperwork was signed, the house is legally yours. If your dad feels he is owed more or disagrees with how the money was handled, his only option would be to pursue a civil lawsuit to claim what he believes he is entitled to. The police would not get involved in this type of dispute. 
 
If he does hire an attorney, you may receive a demand letter asking for repayment or threatening legal action. That does not mean you have to pay immediately—it is simply the first step in a civil process. At that point, you could respond with your own documentation: the signed papers, records of the $5,000 transfer, and testimony from the two witnesses to the agreement. Having all of your records organized will put you in a stronger position if the matter ever reaches court. 
 
To protect your family, keep copies of all written agreements, proof of payments, and communication with your dad. Avoid informal promises going forward and only deal with him in writing. Even if he moves ahead with legal action, the worst outcome would likely be a financial judgment, not jail or loss of custody. By preparing your documentation now, you’ll be ready to defend yourself and protect your family’s stability.

Q: What to expect when dad sold me a foreclosed house and now threatens legal action?