It is really not your agents responsibility to investigate adverse issues regarding permits. His or hers responsibility to you is to disclose, and it is up to you to do your due diligence and to investigate property condition. Often times, agents will do search for you regarding permitted issues, etc. This does not mean that this becomes their fiduciary duty to you. Their fiduciary duty to you is to disclose all they know about the property, good and bad, and let you make final decision on accepting, open escrow, etc.
You should have asked more questions. You should have spend more time doing your homework. With little you have explained about your situation, it seems to me that you are trying to shift blame to your agent. They did not put a gun to your head and forced you to open escrow or to accept unpermitted add-ons...did they??
In non-real-estate related matters, I have a "three-strikes" rule: you give me three unreconciled problems, I get outta there.
But the fact of the matter is that it's difficult to say "no" to a good deal - a short sale, commission rebate, in-office one-stop shopping against competing offers, how can you refuse?
I don't know the answer. Our home buyer appears to have suffered insult in addition to injury, but there's a complicity here, too - why continue to deal with unethical people?
On your next deal, MV Buyer, don't swim with the sharks. You'll save yourself a lot of headaches, and you can still get a good honest deal.
All the best,
None. except to tell you that there are no permits.
A smart sellers agent would tell you that there are "no permits" if they know about it.
Real estate agents are not permit experts or land use experts, and should not be relied on as experts in these matters. The fact than an agent may have a little more knowledge than a buyer in these matters does not qualify them as an expert; in addition, acting as an expert outside of the scope of providing brokerage services exposes the agent to liability.
As for the seller's agent, it is not their responsibility to independently verify the accuracy of information provided by their client.
MvBuyer, I understand your problem, but the burden of investigating concerns falls with the buyer, not the agent.
All the best,
Let me know if you have any questions.
#1 Listing and Selling Agent
Keller Williams West Los Angeles
You could have also searched the City of Mission Viejo website on line for BUilding Permits issued, etc.
http://dms.cityofmissionviejo.org/sirepub/docs.aspx >>> Select Permits and enter the address. This is public information and readily available.
To answer your specific question, NO. It is the BUYER's responsibility to perform all investigations and Due Diligence during the contingency period. Read the Residential Purchase Agreement - it clearly spells it out.
I think there is likely other issues with this transaction as you have mention in your other questions on Trulia.
Broker / Owner & Certified HAFA Specialist
Thom Colby Properties
Newport Beach, CA
Moving Lives Forward (TM)
We NEVER DOUBLE-END Transactions in our Brokerage. There is NO benefit to the Seller or Buyer and only benefits the Agent. Also, NEVER use your RE Agent / Broker as your Lender or vice versa. Also, be careful when using Real Estate Broker-owned Escrow and Title Companies - they can be loads of trouble.
888-391-5245 Direct Cell
We can't control the actions of other people, but we can control our own - I reaffirm my caution about swimming with sharks.
All the best,
I am sorry you had to go through this. We as REALTORS often warn buyers - especially first time homebuyers about dual agency/dual representation. It can be done legally, but it is a LOT to handle for a first time homebuyer and I am personally against it. I have never done it, even when I had the opportunity. I hope you didn't go with the listing agent just to get the house. It's already been echoed by my colleagues and DRE: what's in writing is what goes. You signed it.
So what is the resolution on this situation? Have you cancelled escrow? Please make sure you check the credentials of your next REALTOR and maybe also ask to speak to former clients. Good luck!
I believe it was as Joseph said it was a tough lesson, but what I don't understand is why you would have changed you RPA after everything was accepted. If you had indeed the box checked with contingent til loan is funded why on earth would you change that at all? Unless it was in a counter offer but you indicated that it was after the fact and the seller was threatning to cancel if you did not change that. Not something the seller is allowed to do. Was there maybe something else they were able to cancel on you because of and they used that as leverage? At any rate as I said before I think you should attempt to recover some of your deposit. Remember the seller needs to cancel with you before they sell to someone else.
You have admitted multiple times that your agent pressured you to sign these documents with terms you were not confortable with, but you also admitted that you agreed to these terms so that your offer would be accepted. You learned a tough lesson here; don't agree to something you arent completely comfortable with.
I hope thing work out for you.
Agents and even their brokers who are suppose to live and work by the REALTORs code of ethics, can say and do anything they like, so long as either your signature or your brains are on the contract.
I called the DRE with a complaint about the constant badgering for me to agree to the 17 day loan contingency. I told my agent at least 10 times, I will not agree. I had them check the box that reads loan contingency will remain in effect until the loan is funded. They didnt like it, but the accepted the offer. Still they continued the pressure and threaten dropping my offer in favor of another that was agreeing to the 17 day contingency. So finally I agreed and they amended the RPA. I spoke with a deputy at the DRE and he said the judge will ask you MR. MV buyer, did you sign the contract? if yes, CASE CLOSED. So no matter what tactics or threats or out right lies they use to get that signature. CONTRACT RULES, right?
Sounds like you have had more than your share of trouble in this escrow. It also sounds like you were aware of the permit issues going in. Your agent has a duty to disclose only what they are aware of. It is not up to he or she to investigate. However; it is up to your agent knowing that there are permit problems to let you know FHA will be a problem. FHA is not always a problem if there are no permits as long as the work was done properly, but they will not give any credit in an appraisal to additional square footage if there is no permit. I do not know the problem you had with FHA but as an agent if I knew there were permit issues I would certainly get the FHA appraisal done immediately. If you can't get the loan you should have got your deposit back as long as you were within your time frame in your contract. There should have been time to cancel and get your deposit back after the appraisal was done. And it doesn't matter what lender you have the appraisal is the same. As for your agent pursuading your to sign the contract that was not in your best interest I don't know what the issue was but there are times when shortning time frames or not asking for costs can be a benifit to you. Hindsite is always 20/20!
As for the deposit you need to check your contract to see when you needed to cancel by and under what terms you were allowed ot cancel. $1000 is in my opinion not a reasonable fee to charge you for cancelation at the last minute. Should be far less. Remember no one can take your money without you signing to release it. You should call an attorney or at the very least go to small claims and see if you can recover some of your deposit. Find another agent and carry on. Buying a home should still be a priority as now is a great time for home buying. Please do not be discouraged as there are many Realtors out there who will be happy to help you out and keep you far more informed than you seem to have been this time around.
Best of Luck to you,
Prudential CA Realty
I know Consumers have access to so much more info now, than ever before, but there is no substitute for a Knowledgeable and experienced Realtor...ya ya, I know, sounds like a "Sales Pitch", coming from me, but it's times like these (and you are not a rarity, in these times of REO's and Short Sales)
Take your time, do the right thing, and it will all work out...I wish you all the best =)
My Agent breached a verbal contract to a commission refund. Agent grossly misrepresented the value of the property we were trying to purchase. Agents evaded and ignored questions about the condition of the property. Agent misrepresented the role of an attorney negotiating terms of a "Short Sale". Agent pressured us to their "preferred" lender. Agent pressured us to sign sections of a sales contract that was against our best interest under threat of loosing the property to another buyer. Agent and Broker misrepresented the sales contract regarding our changing lenders at the beginning of escrow. Agent and Broker tried to blame us for our choice of lender when FHA loan approval failed due to conditions of the property. Managing broker agreed verbally to our request for changes in the terms of the agreement then recanted when we requested new terms be written into the escrow. Broker fully sided with the sellers placing blame on us, the buyers for the cancellation of escrow. Our agent instructed escrow company to issue cancellation instructions without our consent at the direction of the selling agent . Broker/Manager told a direct lie about original signed documents from the seller being required to release our escrow deposit. Managing Broker issued several insulting and demeaning emails and to top it all off, escrow company is charging a (reasonable cancellation fee) of $ 1,000.00. Nice huh? There is a lot more detail of course, but this is our 1st time home buying experience from a dual agency broker with attorneys representing the sellers and broker owned escrow.
Whether Seller, Listing Agent, or Buyer's Agent, if there is knowledge an actual material issue being present it needs to be disclosed. Potential issues, while they may be eventually proven to be benign, are a gray area (personally, I disclose these as well).
"Shouldn't a buyers agent fully investigate a known concern about expired permits and fully explain the possible repercussions to their clients before allowing them to enter escrow on a short sale? Especially when it is a FHA loan."
Actually, it is not the duty of the Buyer's Agent to exhaustively investigate issues; however, in the case of expired permits a Buyer's Agent should be strongly suggesting the Buyer do so and can aid in the effort. Certainly, the risk of expired permits should be discussed no matter where financing is being obtained. Any Appraiser would want to know about potential expired permits as well, as this could affect the valuation of the home as unpermitted work cannot be given value.
â€œAlso, what is the sellers agent's responsibility when they have been told the permits are expired and their clients are misrepresenting the status of the permits?â€
A smart Sellerâ€™s Agent will work towards uncovering the facts regarding the permits and then advise the Sellers appropriately based on the facts.
Here are the address phone numbers to vall at the City of Mission Viejo
200 Civic Center
Mission Viejo, CA 92691
Open Monday through Friday
8:00a.m. - 5:00p.m.
Building Information 949-470-3054
Building Inspection 949-222-4694
Code Enforcement 949-470-3055
Health Inspector 949-470-3027
Planning and Zoning Information 949-470-3053
Email : firstname.lastname@example.org
Hope this helps
The Seller and the listing agent need to disclose what they knew about the property. If there is an unpermitted addition, as an example, they should disclose that, if they had knowledge.
It depends on who know what , what was disclosed and etc. Many times buyers agent DON'T know OR listing agents till discovered through the buying process.
Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors