Home Buying in Oak Hills>Question Details

Will, Both Buyer and Seller in Oak Hills, CA

Offer was accepted on a short sale by bank. Broker/agent sent me an addendum stating that buyer will be responsible for ANY fees and or penalties if

Asked by Will, Oak Hills, CA Thu Jul 8, 2010

the transaction does not close escrow within 30 day. She the broker stated that this how it is done. Obviously know one in their right mine would sign something that states any amount. She could not even give me the amount of the penalty fee if it did not close in 30 days. What you think about this.

Help the community by answering this question:

Answers

12
Without many details--Consider consulting with an attorney who specializes in real estate and have all documentation reviewed--he/she will be your best source of advise as it relates to your specific situation and he/she may save you money in the long run.
1 vote Thank Flag Link Fri Jul 9, 2010
Hi Will,

As others have posted here, do not sign an open ended fee agreement. Some short sale contracts have a per diem, usually up to $100 per day, if escrow does not close on a certain date.
Contracts are like anything else, and can be negotiated. Just because it is a short sale, it should not be OK to charge a per diem.
You can always, negotiate, and if the deal is not good for you, you may have to walk away. Talk to your agent as to your options.
Usually, if the bank already signed the contract, you should not have to pay or agree to pay for any fees.
If the bank has not signed the contract, and is sending you a counter offer with the fee addendum, you have the choice to negotiate, sign as is, or walk away.

Again, talk to your agent.

Douglas Lagos
Realtor, Certified HAFA Specialist
Coldwell Banker
0 votes Thank Flag Link Wed Jan 23, 2013
Will;

This is always a difficult subject...

The buyer may be responsible for any fines incurred by the bank if the buyer failed to perform under the contract. For example, if the grass became too tall and the city had to go cut it. Building permits may expire and the city may impose penalties.

It is ALWAYS important that the buyer perform according to the contract. If you don't have the confidence that your lender and Realtor will perform, you should consider cancelling the contract before you assume the liabilities of defaulting on the contract.
0 votes Thank Flag Link Wed Jan 23, 2013
the offer is not yet accepted by the bank , it is probably going to be accepted within a month and the broker just wants to make sure you are ready with all the down payment and other formalities and mentally prepared. just ask her u want to see the original bank s acceptance letter which will definately state any penalties u might have to pay or the seller . that is what u will read and go by it .
same thing happened with me my broker said your offer is accepted and the bank wants to close in 30 days and the bank wants to see that $50000 down payment in my account which was going to be transferred from india and i transferred all the money from india by paying extra fees and when i told my broker here i have the down payment and i am back from india getting the first flight so excited i won this house here THIS MORON WENT ON TELLING ME THE BANK TOLD BE VERBALLY AND THAT THEY FIRST WANTED TO SEE THE DOWN PAYMENT . this is how it works you must ask the official acceptance letter from the bank.
0 votes Thank Flag Link Sun May 13, 2012
Ask for a copy of the approval letter. It will usually state how much the per diem charge is and often times those funds can come from anywhere. The bank will only be concerned with their net at closing. I've seen buyers, sellers and real estate agents pay those fees depending on who at fault for the delayed closing. Find out if this form is from the bank or an addendum that was drafted by her the agent.
0 votes Thank Flag Link Tue Sep 28, 2010
Will, You should carefully read the addendum again. The addendum should clearly state any fees or penalties incurred should you not close by the specified date.
0 votes Thank Flag Link Tue Sep 28, 2010
A buyer should never sign an open-ended addendum such as this, and a good buyer's agent should at least attempt to modify the language to protect their client. The most important piece of language missing here is language to identify the cause of the failure to close, i.e.: ..."if this transaction fails to close within 30 days due to buyer's failure to perform under the terms of this agreement". The current language obligates the buyer to pay fees even if it is due the seller's failure to perform. I also agree with some of the other answers, the addendum should stipulate a fixed dollar amount in order to limit the buyer's exposure if he decides to move forward. I've closed multiple short sales and have never seen this type of addendum used by the seller or the lender.
0 votes Thank Flag Link Tue Sep 28, 2010
The addendum has to state the per diem amount and the amount of any additional penalties if you can not close escrow in the allotted time. Don't sign anything until you know that dollar amount.

Would you buy a car not knowing how much the tax, title, and license fees will be?

Willy
Atlantic & Pacific Real Estate
0 votes Thank Flag Link Tue Sep 28, 2010
Is there a trustee sale date scheduled within that 30 day time period? If so then there are lender costs associated with postponing the sale. If not then there is no good reason for the servicer to include that in the approval letter. Request a copy of the short sale approval letter to verify who is making that demand. Is it the realtor or the short sale lender? I have never had a short sale lender give me an approval with that condition and I have closed over 25 short sales in the last 16 months. If it is in the approval letter the only question that remains is can you close within that time period? Good buyer agents that are assisting there clients with purchasing a short sale should always know if and when the trustee sale is scheduled. They can find out that information without asking the listing agent. Feel free to call me anytime it would be my pleasure to answer any of your questions. 760.845.1262
0 votes Thank Flag Link Fri Jul 9, 2010
You have to read over those addendums very carefully. You may also wish to speak to a attorney. I have always had the penalty fee (per diem) stated in the addendums. My lenders will state in their addendums that the subject must close no later then ???? sometime's it is what the buyer had on the countract, sometimes 30 days, sometimes two weeks...if it is a cash transaction and if the closing runs after that point, the daily fee kicks in. My lenders will not tolerate their addendums being changed in any shape, way, form......at all.
0 votes Thank Flag Link Thu Jul 8, 2010
Will, some banks will charge fees if you don't close on time. They don't care what the cause is. The appraisal and getting your mortgage is usually one of the things that hold up the closing.
0 votes Thank Flag Link Thu Jul 8, 2010
Short sales have associated cost risks to the buyer when dealing with these types of transactions. You could pay your $450.00 appraisal, your $300 home inspection fee and while your offer is accepted the property could still go to foreclosure or the seller can cancel the sale. That risk is inherent in any short sale transaction.

Your question is to vague to answer. Send me a copy of the addendum if you like for a better response or let us know what the exact verbiage is so we can assist you.

Regards,

Cindy Vedder
951.231.8439
0 votes Thank Flag Link Thu Jul 8, 2010
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer