Home Buying in 10469>Question Details

Chynna, Home Buyer in 10467

Realtor's let's go over this again - I need to be clear and I need answers -about the contract rush!

Asked by Chynna, 10467 Wed Jul 8, 2009

I wanted to purchase a townhouse. I had a broker representing me, I advised my broker as to how much I was willing to offer on the property. My offer was accepted by the seller's agent; the next thing I knew, 4 days later my realtor calls me and states the seller's realtor wants me to have an inspection ASAP! I had the inspection done it cost me $395; termites were found in the basement and a few other issues. The seller had the termite situation treated. Once again, allegedly the seller's agent tells my broker, have your client sign the seller /buyer contract asap with the downpayment attached of $50,000, no later than the end of the week or else I am moving on to another buyer! I felt rushed, disprespected, & pressured. I was trying to consult with my attorney about the problems noted in the inspection report, and I was trying to get the seller to negotiate with me, which the seller refused to do. I did not move forward with the deal. Realtors why all the games?

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If you made a written offer on a house annd the seller signed it and returned it to you then the offer becomes the contract. Once it is returned to you it is official and 'times is of the essence' which is in just about every contract I've ever seen. That means you have a certain amount of time to do what is requested (and the seller has the same responsibility) and all these times are spelled out in the contract. (Re-read your contract carefully to see how many days you had to do what.. get a loan, get an inspection, get an appraisal). If you made the offer contingent upon an inspection, you have x number of days to complete it. That is all spelled out in your contract. If not,, you had a poor contract to start with and your lawyer should have told you that. If it was spelled out in the contract then you have the legal obligation to meet that x number of days. The process you went through sounds a little backasswards to me. I've never known of an inspection to be completed before an offer/contract was signed. If you did have a signed offer/contract then you should have been able to negotiate with the sellers through the realtors for either corrections or escrow money to fix and the other realtor could not 'move on' to anyone. I certainly would have done the same as you and not moved on if things were not done in line with contract terms. Good luck with your next endeavor. You might want to check out the laws about real estate sales in your state before you proceed. Most states have a real estate code on the books. Then you will be more familiar with what is expected and when. Also, I suggest using a lawyer who specializes in real estate not just any lawyer. (A corporate lawyer or criminal lawyer won't know squat about real estate just as I have a real estate license that doesn't make me a real estate lawyer.) Best wishes!
0 votes Thank Flag Link Wed Jul 8, 2009
C
The previous post covered a lot ground and looks to be the best.

Most first time buyers are not adequately prepared for the purchase process. Remember the first time you bought a car? A lot of things go on that may concern you and make you feel uncomfortable because they are not known in advance.

The period called the contingency period is when you perform your investigations. Normally a buyer can cancel with no harm within that period for almost any reason.

However, there is a difference between having an accepted offer, opening escrow, and the contingency period. As the previous poster stated, look at your contract.

Normally the buyer shows the seller a preliminary deposit check for a small percentage of the purchase price. In CA it is around 3% by custom, but any amount can be used.

Once both parties agree to the offer, then the buyer's agent opens escrow with the initial deposit check.

Now the contingency period starts. You do your investigations, the appraisal, get the loan approval, etc.f

Usually the contract states what additional deposit (say 20% down). If you've given them 3%, then the contract states when the remaining down payment needs to be deposited with escrow. In most cases that is AFTER you have removed contingencies and are sure you are going to buy.

Read your contract, ask your Realtor questions.

Good luck.
1 vote Thank Flag Link Wed Jul 8, 2009
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
Contact
In our state of Indiana, once terms and price are negotiated the Buyer and Seler sign a purchase agreement, and Buyer is now subject to contract . Terms include payment of earnest money which is paid to Buyer's brokerage to hold in escrow till closing and then applied to final settlement statement at Closing.
Also, contained within the contract are the BUYER timelines set for having an inspection, application for financing and homeowner's insurance. These timelines are setup according to what the projected closing date will be, in order to complete all 3 items by then.

Sounds a little backwards the way this is handled. So I'd have to ask did you and seller sign a contract laying out timelines for all inspections, financing and homeowner insurance? When this is done, there is no rush needed since timelines are in place and agreed to by both parties.

A moment ago - Delete this answer
1 vote Thank Flag Link Wed Jul 8, 2009
Unfortunately in this part of NY, unlike other places in the US, the seller can entertain as many offers as they like and the house is not yours until you are FULLY in contract.

If anything, although maybe a little pushy, the Realtor, believe it or not, was doing you a favor by trying to move you forward.

My question is this, wasn't your attorney having any conversation with the seller's attorney?
Web Reference: http://GailGladstone.com
0 votes Thank Flag Link Wed Jul 8, 2009
Hello Chynna,

With all due respect...even though I am of the old school belief that #1. "the customer is always right"... #2 If the customer is ever wrong...please see rule #1....I must interject only because it is for your benefit to know how things work in the real estate world and the why's and wherefores.

It is not to say that some agents are not "pressuring" their clients into making the decision as fast as possible because at the end of the day...if you are a full time agent...if you don't make the sale you don't eat and are on the street.

THAT said...I am STRONGLY of the belief that you cannot make others invest in a home they are not sure about...and I have worked with people for over 9 months and counting to make sure they are happy with the place they end up calling their new "home".

All of the above said...I do want to point out that to anyone reading your post it reads as a bit of a criminal intent...you say your agent "alleges" that the seller said this or that or that their lawyer said this or that...why would you not believe your agent? I think most important thing of all, you need to develop a rapport and even trust with your agent - I say this to anyone...never work with an agent you feel you cannot trust. Ask for references...talk to people and ask who they've used...look online for agent reviews if need be...but don't put yourself in this kind of situation.

Now to play devil's advoate here...or better yet...just point out the other side of the equation.


First...remember there are 3 sides to the story...there is the seller that has their own motivations, then the buyers that have theirs and the agent that must try and make both parties happy to make the deal work.

I currently have 3 deals in the works that are in the same situation. The seller is pushing to make things move faster....the buyer is slow to respond...the seller is threatening to move on to the next bidder if the buyers does not move as fast as they'd like or answer by certain given dates...it is the sellers perogative to do that...as we don't know what THEIR situation is and why THEY are in a hurry...but the bottom line is...if they DO have 3 offers on the table and they want to sell asap...it is their perfectly given right to tell a buyer that is on the fence...listen...if you don't sign by end of the week we are moving on to the second accepted offer. It may sound horrible to the buyer and I understand where you are coming from.

But unfortunately in business...each side is only concerned about their own deadlines and budget...the buyer cannot expect the seller to care that they are not sure yet...nor is the buyer expected to care that the seller needs this money this month before the house goes to foreclosure or whatever the stories behind each is.

When dealing in real estate you must keep things in perspective and understand that the agent is most of the time put in between a wall and a hard place...and we end up taking the rap...the seller wants to move too fast the buyer wants to move too slow and both buyer and seller end up blaming the agent for the lost deal. This happens to all of us at one time or another.

At the end of the day...I just wanted to point out to you that your agent really just may have been telling you the honest to goodness truth...now...if you were not ready to purcahse or had too many doubts...it's a good thing you did not go through with it. But if you DO have an agent you can trust. since our jobs are not just to show houses and negotiate we always try and answer each and every single concern so that the buyer feels confident to move forward. We are there to provide you all the information you need...so that you can then weigh your options and know whether you should go for it or walk away.

I think I speak for ALL realtors when I say...we are not interested in playing games...we are interested in making things work out...but are only as good as our buyers and our sellers.
0 votes Thank Flag Link Wed Jul 8, 2009
A lot of times buyers take a long time scheduling inspection, reviewing the results and then at the end decide not to go ahead with the deal. As a result, sellers end up losing deals with other qualified and motivated buyers. Just think if you were in their sellers shoes.

On the other hand, the seller has to give the buyer enough time to do the inspection, a week is fine, and another week review and negotiate the results of the report. The review time and negotiaton time may be longer in case you need estimates for repairs you are considering doing yourself. Any longer is a waste for both parties especially if the delay is caused by both not agreeing to 1 or more terms. Move on, there are more homes out there or give in to the term(s), waiting a month to come to this realization does help anyone. Who know the seller may come back and say they agree after you moved on or you as the buyer may reconsider and take the deal later.

Now if the both the parties agree to certain terms have your attorney add the agreement to the contract, sign it and send it to the seller attorney to be signed ASAP. Once the seller signs you have a deal, the terms of the agreement have to be met prior to closing.

If you delay and some offers more money and better terms to seller and you can loss the deal and all your effort and the money you spent.

Milton D. Johnson
http://www.milton4realestate123.com
0 votes Thank Flag Link Wed Jul 8, 2009
Different laws in different states. Here in SC - you are under contract when both parties agree to a price and certain conditions and both have signed the contract. All contracts are contingent up certain things, for example -all mechanicals must be in working order(AC/ heat etc..), broken windows must be replaced, there must be a CL-100 (termite inspection with a good result) and several other things as well. Anything the home inspector finds may be brought back to the sellers in the form of a repair request. The sellers may agree to repair any/all of the items or none of them provided they are not specific to making the home habitable (ie: heat AC, etc..). If the termite inspection turns up an active infestation of termites or other wood damaging insects (some beetles and bees) or structural damage caused by a prior infestation then the sellers are legally bound to treat the active infestation and repair any damage thereof. The sellers are not legally bound to renegotiate the price/contract. You do have the opportunity to back out of the contract upon receipt of a 'bad' CL100 report. Lenders will not (unless a hard money lender) extend the loan without a clear CL100. If you were purchasing a home here in SC thru me(and any of my peers here) you would have been told explicitly about this at the point you extended the offer. Cash deals and investor purchasers play by slightly different rules especially when it comes to properties sold 'AS IS'.
0 votes Thank Flag Link Wed Jul 8, 2009
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