Home Buying in Richmond>Question Details

David, Home Buyer in Richmond, VA

Should I sign addendum and modify the original contract upon seller's request?

Asked by David, Richmond, VA Wed May 5, 2010

Both I and the seller have signed the purchase agreement. I did house inspection two days after we signed the contract. Then the seller's agent asked me (through my agent) to sign addendum, also the seller's agent required me to add one sentence in our original contract saying "This contract is subject to Cartus review and approval". I found out that Cartus is a relocation company, and there seems to be lots of complains from both buyers/sellers on the Internet about Cartus. I feel really stressful. Whether or not I should accept this additional sentence in our original contract. Why didn't the seller's agent let me or my agent know that there will be a relocation company involved in our deal on the day we signed the contract. If I reject the addendum, is our contract still effective? Thank you very much for your suggestion.

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Hello, David,
It is clear that the sellers are in the process of being relocated and that there is a 3rd party company involved in the relocation of the sellers. I am surprised that the seller was allowed to sign the contract, as most of the third parties require that the seller negotiate the contracts verbally, but the third party will normally do a buy out and then the third party company (in this case, Cartus) would then sign as the seller. Since the seller signed the contract, it is most likely a seller who does not have a buy out on his contract. My guess is that the third party company is reviewing the contract to make sure that there is nothing in the contract that could adversely affect the seller. In the Richmond area, you most likely used the standard contract form and added in things like personal property, closing date, etc. and any additional terms that would have been a concern to you. What does your agent say about the seller wanting this sentence added in? Your agent should be aware of any items that were written into the contract that could be a concern. I don't know that I would be concerned simply because the third party company is Cartus. I am guessing that there really isn't much to worry about-the third party company is only reviewing it for their client. If you are concerned, why don't you have the contract reviewed by your attorney? Good luck to you.

Barbara Reagan
Long & Foster Realtors
0 votes Thank Flag Link Thu May 6, 2010

Hopefully, this has all been resolved to your satisfaction by this point, but I thought it was important to answer your specific initial question, which was essentially "Do I have to sign this addendum requested by the Seller?"

In the interest of dislosure, I am a licensed attorney, in addition to being a Realtor. However, this post does not constitute legal advice, is about general legal principles only, and for answers to specific questions your attorney should be consulted.

Phew! That Disclaimer/Disclosure out of the way, here is my analysis of your initial question: You are under no legal obligation to execute the Addendum adding that language requested by the Seller. If the initial contract was properly ratified by all parties, with all signatures and any necessary initials, then you should have a fully ratified and binding contract under Virginia law.

It may be true that there is no downside to you to signing that Addendum, and it allows the Sellers to keep their relocation benefits. You could CHOOSE to sign the Addendum, certainly, and I am sure the Sellers would be grateful. But as a matter of law, if there is a fully ratified contract between the parties, neither party can REQUIRE the other party to accept an Addendum.

Clearly the involvement of the relocation company should have been disclosed on the front end. I suspect it was a matter of oversight, not intention. Best of luck with your purchase, and just remember, you are buying the home you wanted. Get excited!

Best regards and god luck,

Melissa Loughridge Savenko
RE/MAX Commonwealth
509-511 N. Meadow Street
Richmond, Virginia 23220
P: 804-986-3993
F: 804-612-2737
E-mail: melissasavenko@gmail.com
Check out my blog at http://www.melissasavenko.typepad.com!
1 vote Thank Flag Link Tue May 18, 2010
I find it strange the listing agent did not know that this was a relocation situation. I have had to do several relocations and they are always disclosed, because the relocation company often has lots of addendums and things that need to be signed off on prior to ratifying the contract.

I've heard a lot of agents giving you advice to see if your settlement attorney could advise you, that's of course if you retained a settlement attorney and not just a settlement company.

Litigation is never the way to go, however if now you think you don't want the place, my advice, is to seek a way out on one of the many contingencies built into a Virginia contract. In Richmond, VA agents have a choice of 3 different purchase agreements, All have a financing, home inspection and hoa contingency built right in.

I agree with you though. Dealing with a relocation company is quite possibly as painful as dealing with a short sale or foreclosure. They require lots of paperwork, time, and check points, with lots of bureaucratic red tape, lots of levels of hierachy to approve this and that.

Trust me though the Seller has to go through just as much stuff as you the purchaser. Its a 2-way street of mounds of paperwork and checkpoints.

I'd love to hear the listing agents side of things with the whole disclosure thing. It's usually very evident by then that a relocation company is involved.

Not sure if I agree that there would be a price reduction just b/c of a relocation company involvement, but my experience with relos is they are, unless you have a very savvy listing agent on the otherside, a nuisance to work with.

Ty Dwyer
First Choice Realty
0 votes Thank Flag Link Tue Jul 6, 2010
Most Relo companies do require their approval on a contract, in order for the seller to receive his proceeds up front, and other benefits. Often the actual seller is "out of the loop" after their approval, and the relo companies meets the terms of the contract. Knowing the relo will be a major player in the transaction, I see no reason not to sign this addendum, but I would have a deadline added that procures approval by relo with in a reasonable number of days, so you are not left hanging without knowing if you have a contract or not. I would also not have an inspection report deadline until after that approval is received.
Good luck. I expect all will work out fine.
Evelyn Hunt CRS, GRI, ePro
Classic Realty Services
Richmond, VA
0 votes Thank Flag Link Wed May 19, 2010
My name is Jon, and I am with Cartus' Office of the President. Your comment above was forwarded to me in a Google Alert. I would like to speak with you and see whether your contract situation has been resolved. Please either call me at 888-767-9357 or email me at officeofthepresident@cartus.com.
0 votes Thank Flag Link Fri May 14, 2010
Hello, David,

I certainly understand what you are saying, and I agree that this should most likely have been disclosed by the seller and/or the sellers agent at the time of the original offer. Again, your Buyer Agent or Attorney can advise you on whether or not - a) you should or shouldn't sign the addendum that modifies the contract and b) whether you have a right to have any of your costs that you have already expended reimbursed to you. As April said, the relocation company is most likely paying the costs of this seller's commissions and other costs of sale, and are advising their transferee, which is most likely the reason for the review by the relocation company. However, the seller is ultimately the person who determines what price & terms they want to sell at, not the relocation company. This means that you may or may not have been able to get a much lower price than you have already gotten. The relocation company has no authority to tell a seller the amount of money they can or cannot accept for their property. But again, I would certainly say that at this point, you should probably be directing your questions for reimbursement of expended costs to your Buyer Agent and your attorney that is handling your side of the closing. Good luck to you with the transaction.

Barbara Reagan
Long & Foster Realtors
0 votes Thank Flag Link Fri May 7, 2010

I mean if the seller's agent had disclosed the future involvement of the relocation company before we submitted our offer, I would have submitted a much lower offer that they would still have accepted anyway. In other wolds, because of the lack of this important information (whether the seller's agent hide it intentionally or not, I don't know), I lost money. Now my question is that if I can get some of my money back in exchange of accepting the involvement of the relocation company. Thanks.
0 votes Thank Flag Link Fri May 7, 2010
As Barbara said, if a seller gets a buyout from Cartus, then Cartus usually has to sign the contract. This seller most likely has to sell the home themselves but has commissions and closing cost paid for by Cartus. There is no reason to think that you would have gotten a better deal as the seller always is the one to negotiate the terms of the sell. Cartus never does.
0 votes Thank Flag Link Thu May 6, 2010
Hello, David,

Other than the one sentence that they have asked you to put into your contract/addendum, are they asking you to pay a higher price than what has been negotiated? What does your Buyer Agent tell you she/he thinks is going on? With most of the relocation transactions that I have done in the past, the seller negotiates the price and terms and usually (if the seller has a buyout) the third party company signs off on the offer. I have never had a relocation seller negotiate a contract and get price and terms that were agreed to verbally by all parties and then have the third party company, like Cartus, come back and change all those items if they didn't like them. So it doesn't seem to me that, at least based on what you have indicated in your question, that Cartus will come back and now try to renegotiate the contract, simply based on this one line. If for some reason, they do try to renegotiate your contract, then I would suggest that you talk to your attorney that you have requested to do your side of the closing (hopefully, it is not the same attorney representing the seller.third party company) and talk to your Buyer Agent as to what your next recourse is. Again, I would not want to give legal advice as to whether or not you would have a case to recoup any costs you have already incurred. This is definitely a question for your attorney and Buyer Agent. Good luck to you on your transaction.

Barbara A. Reagan
Long & Foster Realtors
0 votes Thank Flag Link Thu May 6, 2010
Thanks for all your suggestion. Now I am thinking the seller's agent might do this purposely to get a higher offer (otherwise, I would offer much less if I was told that a relo company will invovle). Whether or not the seller's agent did this on purpose or due to negligence, I lost money and the opportunity to get a better deal. Therefore, I was wondering if I can ask the seller to compensate me for my loss and then I can accept their addendum or the involvement of the relo company. Thanks.
0 votes Thank Flag Link Thu May 6, 2010
David, I deal with Cartus on a regular basis as I am a Certified Cartus Marketing Specialist. It sounds like the listing agent is not use to dealing with Cartus as any addendums or added wording to the contract should have been done prior to you signing. The sellers are getting relocated by their company and using Cartus to assist with the move. In order to sell the home and get the relocation benefits, the sellers have to do what Cartus requests. I don't anticipate any problems with adding that wording to the contract but it should have been done earlier. Cartus only looks to make sure the contract is filled out correctly and everything in it is normal and customary for your area. They want to make sure there are no unusual wording or special conditions in it. The sellers may not be able to sell and move if they don't get that addendum back as they could lose all of their benefits. Cartus wants the sellers to sell the house as they are accountable to the sellers employer. Don't believe everything you read on the Internet as I can find complaints about almost every single company on it.

April Crowder
Licensed in NC & SC
Coldwell Banker United, REALTORS
0 votes Thank Flag Link Wed May 5, 2010
Dear April , I have seen house and submitted offer without know that there is relo company . the seller agent again sent Addendum which is preceding the contact conditions . we end up with two seller . one on the main contract and other one on the Addendum of Cartus . please advise
Flag Wed Apr 6, 2016
Gee, David. We don't know if you should or not.

What happens if you don't sign the addenda? I'm guessing, not much good. The Seller doesn't sell, you can spend a fair amount of money in court trying to get damages, it isn't pretty.

If the Seller is really intent on going through the relo company, I think your two best choices are to agree, or walk away from the deal.
0 votes Thank Flag Link Wed May 5, 2010
You may wish to consult with an attorney who specializes in real estate, and see exactly what options you may have--have all paperwork reviewed--you should have been notified of any addendums prior to your contract signing and again your attorney can best advise you.
0 votes Thank Flag Link Wed May 5, 2010
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