Question Details

Brian H, Home Buyer in San Francisco, CA

SHORT SALE Problem, need help PLEASE! Listing agent did not disclose unofficial renters and told me less than 8 days ago! Thanks!

Asked by Brian H, San Francisco, CA Mon Nov 19, 2012

I have a situation with a seller who didn't disclose there were renters in the house that I am purchasing. The renters do not have any kind of agreements, lease nor any deposit, no documentation. It is the owner's friends/family living in the household who are "renting".
The 2nd bank of the short sale was approved about 1.5 weeks ago, and the renters were promised by the owners 30 days to move out. Unfortunately my short sale approval expires on December 4th, and my rate lock expires on November 29th. My original close of escrow is on November 28th.
I want to buy the house as I have already invested a lot in the reports, inspections, etc., What can I do? I'm afraid that once I close escrow, the renters become my problem. Even though they say they will leave by December 17th, is there a legal way to guarantee that?

Help the community by answering this question:


Congrats on what appears to be a good outcome.
It seems all the bases have been covered as best as can be with the exception of holding some of the 'renter' or seller money.

What holds up in courts depends on the skill of the attorneys involved and the pockets funding them.

Try not to drive yourself nuts worrying about what might happen. Consider offering the 'renter' an incentive for leaving the place clean or early out, that could offset some of their moving costs. This may open a communication channel for you to monitor their relocation progress.

It's time for you to start packing the seldom used stuff..
Best of success to you.
1 vote Thank Flag Link Tue Nov 20, 2012

1. The "renters" have agreed to leave by Dec 17th, it will be a signed document

2. The sellers agreed to pay for any eviction costs necessary if the "renters" refuse to leave, this is on the addendum

3. The sellers agreed to pay for any damages done by the "renters" if necessary

Do you think the addendum will hold up in court?
0 votes Thank Flag Link Tue Nov 20, 2012
You're right to be concerned and I would strongly advise you not to close until after they've left. Rates are stagnant so I would worry about the rate lock expiring. You should tell the sellers the truth your lender will not close until the property is vacant. I would also get your closing attorney involved.

While it's too late now you've just learned how critical it can be to not deal directly with a listing agent but to have your own buyer broker.

Good Luck, I hope all turns out OK.
0 votes Thank Flag Link Tue Nov 20, 2012
Are you using an attorney to close this transaction? If so, ask them what to do. It seems to me you may have a couple of issues, one being that the agent failed to disclose the presence of these so-called 'renters'. The other that you now have to either walk away or evict the 'renters'. I would consult an attorney.
0 votes Thank Flag Link Tue Nov 20, 2012
Unless you get the tenants to move before your close of escrow, you may face eviction proceedings to get the tenants out of the house. As the legal owner, you have to right to pursue those legal actions, but it will cost some money. Otherwise, there's not much you can do, given the tenant rights protected by state law. If you're not comfortable, you can always find a way to back out of the deal. You don't have to put good money after bad.
Web Reference:
0 votes Thank Flag Link Tue Nov 20, 2012
Thank you for the advice. I would like to go through with the purchase, assuming I do, would I be able to do some kind of legal action against the listing company for nondisclosure of renters on the property? Is there even a law that requires 30 day notice for non-documented renters? They don't have any proof they are even tenants
Flag Tue Nov 20, 2012
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