Home Buying in San Jose>Question Details

bits, Home Buyer in San Jose, CA

What are my options if Sellers get termite clearance (which requires some digging up in bathroom), and not get the bathroom fixed before closing?

Asked by bits, San Jose, CA Tue Aug 20, 2013

In our case there is some termite work needs to be done under the bathroom floor. Closing is in 3 days, we agreed upon termite fixes that seller would make, but we didn't realize that we could end up in this situation where during closing the bathroom will be half dug up. The placement of the floor, tiles, etc will be done after the closing (though it might be agreed upon). We are giving sellers 1 month rent back so they will be living in while the fixes are done after closing.

As a buyer, I am seriously not comfortable with this situation. My agent somehow isn't understanding why I am not so comfortable with this.

We are being pressured to close on time. But we want to delay it until the tiles are back up.

My argument is that I saw the home in a condition where the bathroom wasn't dug up. For me, termite fixes isn't only about getting clearance before closing. I would like things back in same condition.
Can I delay closing? Will I be responsible for any damages due to delay?

Help the community by answering this question:


Your contract stipulates what you and the seller agreed to. In today's market you are lucky to have a seller willing to do the termite work.

You have an agent and it is important that you and your agent discuss your options and risk. This is why you selected that agent to help you. We are all strangers to you and your contract and the information provided may be a detriment to the flow of your transaction. Not only do you have a contract, you also have personalities and stress of other parties. There is a "dance" of sort in real estate. Let your agent help you through this.
Web Reference: http://www.terrivellios.com
1 vote Thank Flag Link Wed Aug 21, 2013
Hi Bits:

Thanks for your note. First, while most of us are Realtors here and can generally answer your question, truth is, your best answer will either come from the agent who is representing you or the agent's broker. I've not seen the termite report or even your contract, so there may be extenuating circumstances that need to be addressed regarding the repairs and specific addendums that you can have the seller's sign that will help you achieve the goal of having the repairs completed prior to move in. Personally, once you've formed a relationship with an agent or are in a transaction and represented by a Realtor or agent, it's not kosher for us to "second guess" your Realtor especially since we don't have all the facts--just saying.

As for delaying or not delaying the close of escrow, in other words, "performing" on the contract, there are ramifications that will affect your loan and accompanying costs for which you may not be entitled to compensation, and there is the real possibility of breach on your part. To know the full extent of the legal outcome of trying to delay without consent of the seller, you need to contact an attorney for legal advice.

Finally, while I can certainly appreciate your concerns about not getting repairs done in a timely manner, it seems that this is a situation that should have been discussed and agreed upon BEFORE any work commenced on the site. Perhaps the termite repairs are not the real problem here...buyer's remorse, perhaps? Whatever the reason, you can resolve a lot of this with a simple addendum and a telephone call to an attorney if you have continued concerns after talking with your agent and the agent's broker.

Good luck!
Grace Morioka
Allison James Estates & Homes
Buyer Rebates of 1/2 of Commission & Low Cost Listings to Owners
1 vote Thank Flag Link Tue Aug 20, 2013
Have the seller get two or three bids from professionals, if you don't already have one. Have escrow hold back 1.5 times the cost of repairs from the sellers proceeds until the work is done.

J.R. Thrasher
0 votes Thank Flag Link Wed Aug 21, 2013
Hi Bits,

Firstly, in EXACT terms what was agreed upon for Termite Clearance?? One needed to be Specific, in what was asked for.......Termite Clearance & Repairs with All being put back together, in the completed condition as when you wrote the Offer? Go back and look at your Contract and addendums on what was agreed upon?? This will clarify things.
Yes, I would expect property in the completed condition as when I wrote the offer.
Trust you will do a second Walk-Through upon Sellers vacating the home?? And you have enough Deposit being held back in Title from Sellers Funds, to cover all repairs incase not done......All of the above should already have been specified and documented.....if not, get it all Documented, both Sellers/Buyers Sign and agree upon, prior to Closing.....If all is well and completed as agreed at the second walk-through when they vacate, you can then release their Deposit through Title. ...
Is the Rent back Free??
As my colleagues said, if you delay closing, it may affect Your Loan/Rate/Terms.....find that out.
All the Best,
Nina Daruwalla
0 votes Thank Flag Link Tue Aug 20, 2013
The biggest risk is that no one really knows what is under the floor. I have seen cases were the only problem was the vinyl and underlayment were damaged and cost $500. I have also seen cases where the entire bathroom had to be redone because the problem was caused by leaking in the wall. Frankly, i think closing in this kind of situation AS IS or even if you get some $$ credit is risky at best.

If you would like to discuss, call me at 408-690-2998

Guy Berry
Risk Manager
Keller Williams Realty
0 votes Thank Flag Link Tue Aug 20, 2013
Hi, sorry you are going through this and there have been a lot of good answers. In my office it's pretty simple....don't close anything until all agreements have been met. Your lender may not even fund the loan if the property is not in living condition, according to their standards. That is where the differences between FHA and conventional loans come in. Yes, the seller may be need the money but you also need the same home you like enough to bid on. It may be inconvientant for the seller but they agreed to take care of it ( and apparently knew ahead of time when they reviewed the termite bid) and closing will take all incentives left for the seller to move quickly. Your lender will need to be included in this one due to rate locks, funding, etc.... As far as items being done "after escrow," not even lawful in many cases. Everything is supposed to go through escrow, the neutral 3rd party, and they will not be involved once it closes so where is your security? On a hand shake? The seller and both agents can wait to get paid until you get what your owed.
0 votes Thank Flag Link Tue Aug 20, 2013
Thank you for your question:

As the others have pointed out, you need to talk to the Broker of Record that your agent works for. There is not enough information available to us to give you a good answer to your question.

Your agent and the Broker of Record that your agent works for are your best sources of information.

Thank you,
Charles Butterfield MBA
Real Estate Broker/REALTOR
Owner/Broker of Record/The Butterfield Real Estate Firm
Cell Phone: (408)509-6218
Email Address: charlesbutterfieldbkr@yahoo.com
0 votes Thank Flag Link Tue Aug 20, 2013
Wow! My general rule is to avoid any work during escrow - if needed, there should be a credit towards the work to be performed after close of escrow. I would try to delay the escrow until the work is done. On another hand, if the seller needs the proceeds from sale to move, you may want to close on time...

But without knowing the whole situation I can't recommend you what is the best course of action. Talk to your agent, their manager and/or a qualified California real estate attorney.
Web Reference: http://talisrealestate.com
0 votes Thank Flag Link Tue Aug 20, 2013
If you delay closing the seller's will receive their money later. They may need the money to complete the purchase of the home they are moving to.

It appears that the repairs are not required for you to obtain a mortgage.

In a situation like this it might have been better had you accepted a credit for the repairs, then hired the termite company or a contractor to do the repairs. The people doing the repairs would then be responding to your concerns and approval. If repairs haven't started and the repairs aren't required by your lender to fund the mortgage, then you might discuss with your agent the pros and cons of having the termite company give you a quote, and then you hire the repair people. You would need to get the seller's to agree and sign an addendum to the contract adjusting the sale price. This could delay the loan approval though so be very cautious.

Your leverage to get the sellers to do what they promise is their desire/need to get the money from the sale of the home. By closing before the repairs are done you are giving up this leverage but if you don't you may delay when you can move into the property. Talk with your agent and see if either the closing date can be extended until repairs are completed or if the cost of the repairs could be taken off the purchase price.

San Jose home values at http://julianalee.com/san-jose/san-jose-statistics.htm
San Jose just sold information http://julianalee.com/san-jose/san-jose-home-sales.htm

Juliana Lee
Top 2 agent nationwide at Keller Williams Realty, the nations largest
Cell 650.857.1000

Over 20 years experience
Over 1,000 homes sold in Santa Clara County and San Mateo County
Web Reference: http://julianalee.com
0 votes Thank Flag Link Tue Aug 20, 2013
If the seller's are remaining in the property after close of escrow I wouldn't worry about it too much either since your are not moving into the home at closing. Have your agent draw up a short term lease agreement with a agreed upon rent back and a security deposit should any issues arise.

The loan docs and rate lock may be expiring soon so double check all that before you try to push back the closing date.
0 votes Thank Flag Link Tue Aug 20, 2013
Hi Bits, If the seller is paying for this then they should leave approx. 1.5 times the estimated amount in escrow to cover this. You can delay closing, but you have to make sure that the lock on your loan doesn't expire. It will be fine if you close on time as long as the seller is willing to leave that amount in escrow.
If you decide to close on time with the floor torn up, make sure your lender will fund with the bath torn up.

If you have any other questions please feel free to contact me.
At your service,
Certified Distressed Property Expert
0 votes Thank Flag Link Tue Aug 20, 2013
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