Home Buying in San Jose>Question Details

Theleinus, Home Buyer in Santa Clara, CA

can buyer refuse to sign escrow until seller get tenants move out 5 days prior to escrow as specified in Cal RPA-CE 4/10 contract?

Asked by Theleinus, Santa Clara, CA Wed Jul 14, 2010

I'm in a short sale contract with a basic agreement (no written rules in contract), can buyer refuse to sign escrow until seller get tenants to move out 5 days prior to escrow as specified in Cal RPA-CE 4/10 contract?

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Hello Theleinus:

One of the reasons that we, as agents, so often recommend that buyers and sellers employ the use of a good agent is to provide you (as the seller) and the buyer with protection against misunderstanding and, what may now become, a very expensive legal issue. For those of us who have worked with buyers and sellers, I can never say that the deal was "basic" or went "without a hitch", but rather that all transactions have their challenges, and, as the seller without an agent, these "learning experiences" can be expensive.

At this time, if you and the buyer are endeavoring to buy the home without the help of an agent or short sale specialist, or the contracts and forms we use, the issue of the tenant may be only one of 30 or 40 different things that can and may come back to haunt you.

If you choose to sell the home without the help of a skilled real estate professional, please consult and pay the retainer of a qualified real estate attorney to assist you. If you have any questions at this juncture and your agent cannot assist you, please contact a real estate attorney for assistance. Try Alan Berger at the Law Offices of Alan Berger in San Jose, John Hanna or Dave Van Atta of Hanna & Van Atta in Palo Alto, Harry Price of the Price Law in Los Altos. Good luck!!

Sincerely,
Grace Morioka, SRES
Area Pro Realty

P. S. It is my understanding that, regarding your specific question, the dictates of the written contract will prevail over any unmemorialized verbal agreements. If your contract is silent as to tenants, the presumption is not necessarily that they need to move at all. Again, a legal contract is best examined by a legal professional for your best opinion.
1 vote Thank Flag Link Wed Jul 14, 2010
If tenants are still there when escrow closes then I believe you become landlord and are bound by tenant/landlord rules and laws. You should be able to give them 30 days notice to move or 60 days if they have been there for more than a year. If they have a lease in place, then have the tenant produce the lease to you. If tenant has a rental agreement, have the tenant produce the rental agreement. Otherwise, I believe they could be "squatters". You should consult a real estate attorney.
1 vote Thank Flag Link Wed Jul 14, 2010
Theleinus,

Don’t you have an agent? If so, your agent has all of the paperwork that we lack and is in the best position to advise you. If you don’t have an agent…well…there is your first problem.

We don’t know what you mean by “basic agreement”. We wonder if you made an offer using the Cal RPA but subsequently signed an addendum that basically wiped it out. We wonder if the “basic agreement” is an approval from the lender for the short sale.

Too many loose ends to even speculate.
1 vote Thank Flag Link Wed Jul 14, 2010
Well that is a tricky one. It depends on their lease. Often times you need to have that specified in the contract. I would speak with a real estate attorney and your agent to see what remedies you have.

Often times if this is ignored I have seen several buyers have to evict tenants after the purchase which is a great risk and burden you want to avoid.
0 votes Thank Flag Link Fri Jul 16, 2010
Absolutely. If you have a fully executed California RPA with a "property shall be vacant prior to close of escrow", then you need to tell your agent that you need to see that the property is vacant before you sign loan docs or any other paperwork. You need to check too, that the bank has not put a clause in any amendments that state you will accept the property with existing tenants.
0 votes Thank Flag Link Wed Jul 14, 2010
I'm not sure what you mean by "basic agreement"? I'm assuming they already have the lenders approval on the short sale. Are you referring to refusing to sign escrow instructions? I would need more details to give you my opinion. But, you should becareful because if you have already removed your contingencies then you may be at risk of losing your deposit.

Sara Mehrpouyan
Dre#01712757
Rodeo Realty
818-903-2040
Specializing in Foreclosures and Short Sales
0 votes Thank Flag Link Wed Jul 14, 2010
If you do not have a written agreement than you will have a hard time enforcing any verbal agreement. If you did not use the RPA then you can not use it as a contract.
Web Reference: http://terrivellios.com
0 votes Thank Flag Link Wed Jul 14, 2010
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