Melanieme, Home Buyer in Cherry Hill Township,...

Short Sale Drama!

Asked by Melanieme, Cherry Hill Township, NJ Thu Sep 15, 2011

Home inspection for short sale found wall damage from roof leak which wasn't present during initial view of the home. Also active water was detected in the baseboards and on the wall in the closet and laundry area. Heat exchanger on the furnace is no good. Water has accumulated in the fireplace which also was not present initially..Not sure if the damage is due to the heavy rains that hit the area. My plan is to submit estimated for repair and request the bank reduce the costs? Any advice would be helpful.

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Melanieme, your contract of sale should contain a separate document called a short sale addendum. If should have language in it similar to this: that although the house is being sold as-is, you have the right to obtain inspections, and in the event any repairs will be more than let's say $5,000 in the aggregate, you can cancel the contract. Your realtor should have recognized if this language wasn't included and should have advised you to consult with an attorney BEFORE signing the contracts.

The attorneys many of us work with here in South Jersey are below. Simply Google them and tell them Eric Axelson from Sotheby's sent you. I was at a previous company when I worked with them in the past, but John at least should recognize the name.

-John Rothamel, Rothamel Bratton, Kings Hwy, Haddonfield
-Bill Sragow, Law Office of William Sragow, Cherry Hill
Web Reference: http://kurfiss.com
1 vote Thank Flag Link Thu Sep 15, 2011
I agree here with Eric. Good luck
Flag Mon Sep 16, 2013
The Bank probably gave you a Listing, a Contract or an Addendum that said that the house is sold AS-IS:
The Bank does not want to incur any more expense.
They will probably refuse the work and send you a Cancellation.

They will feel that the Selling price was low enough to include some normal work.
The Inspections you did were to give a reason to back out if you found something.

If you cannot accept the House AS-IS, (and I don't blame you), you should be ready to go looking for another house.

Good luck and may God bless
1 vote Thank Flag Link Thu Sep 15, 2011
Thanks for everyone's feedback greatly appreciated. Realtor is trying to tell me if they refuse the repairs and I withdrawl from the house due to the home inspection issues the Attny may try to hold me in breach of contract for walking away and hold me accountable for the commisions. Is she crazy? This is nonsense! As I mentioned the property is not in the same condition is was when I initally made my offer. There was no water damage or visible water!

Sarah I find my self giving my realtor advice on how to address these issues, and it almost feels like she is afraid of conflict. I'm more the pitbull, believe me I'm doing way more than I should be as a buyer.

Out inspection was completed after the bank accepted the offer, which was agreed upon on both sides - and we had to wait for the owner to tonn on the utilites - which occured 2 days before inspection.

Eric I would appreciate the name of the two attorney's in South Jersey as a backup.
0 votes Thank Flag Link Thu Sep 15, 2011
Melanieme, contact a real estate attorney and have him find the best way to draft this letter to the bank informing them of your revised offer. There will be a certain way to do it based on how the short sale addendum is written that will get the best reaction from the bank. I can give you the names of two of the most well-regarded and widely-used real estate attorneys in South Jersey. Just ask!

Best of luck, Eric
Web Reference: http://kurfiss.com
0 votes Thank Flag Link Thu Sep 15, 2011
Try your plan. If it doesn't work, withdraw your offer and submit another with a new price, outling repairs neccessary and the cost of each.

Laura Giannotta
0 votes Thank Flag Link Thu Sep 15, 2011
Hello Melanieme

I would go ahead with your plan, but you should be prepared for the bank to say no. When they issue an approval they have a bottom line number they will accept. However, it is not impossible to get them to absorb the cost of repairs. If the Seller was a primary resident in the home, they may be getting incentive monies back from the sale (HAFA incentives) and there may be room for negotiation. Your realtor really needs to go to bat for you.

You need to do something quickly though, because you only have a certain time frame to challenge your home inspection results.

Good Luck to you.

Regards
Christine Selzler
Realty Internaitonal
0 votes Thank Flag Link Thu Sep 15, 2011
Did you conduct your home inspection after you got an approved offer on a short sale?

If so, you may find that they are not willing to negotiate and further, and most likely it will take a while to hear back from them on your request. That being said, they may, there is really no way to tell. Is your agent guiding you through the process?

As a note, I advise buyers to do a home inspection before they submit a formal offer to the bank for this very reason. It can be a long process in a short sale and to find a 'deal breaker' after bank approval if you wait to do an inspection at that point makes for a very frustrating process.
0 votes Thank Flag Link Thu Sep 15, 2011
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