Home Selling in 92653>Question Details

Vivian, Home Seller in Laguna Hills, CA

BEST ANSWER In CA, the standard purchase agreement states that contingencies must be removed in writing with

Asked by Vivian, Laguna Hills, CA Thu Jan 1, 2009

I’m selling my house – A contract was signed with a buyer on 12/11/08. The contract says she has 17 days to notify the seller of intent to cancel the purchase of the property.
She notified the escrow company on Sunday, 12/28/08 (17th day). The agents on either side or the seller (me) weren’t notified until Monday, 12/29 making it the 18th day.

My question is this: because the seller (or its representative) weren’t notified until the 18th day does she loose her deposit? If not, why?
Note-a "contingency removal" was never signed/requested.

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5
Do you realize that if you want to hold her deposit because of the timing of notice that you could tie you house up in court. Let's say the bank didn't give her an answer till late Friday and she spent the weekend trying to come up with the money. Sunday she realizes she can't get the house and sends notice.
Wow! you want her money! Your agent should of been doing a better job of keeping on top of what is going on.
Valorie
1 vote Thank Flag Link Thu Apr 2, 2009
Vivian
Thank you for your question. This is not legal advice. For legal advice ask an attorney.

I have a couple of points to make:
First, your Realtor is your agent. That means when someone talks to your Realtor, it is the same as talking to you (so far as legal notice goes).

Second, what was the communication between your Realtor and the buyer's agent? Speaking for me, BEFORE an offer is accepted I talk with the buyer's agent and find out why they like the property, when they plan to move, I will talk with their lender to see how solid they are financially.

Third, once the offer is accepted, I monitor the contingency period carefully. If I sense that the buyers are at all shaky, then I will step up my level of vigilance. Usually if the buyers have a weak agent I can sense the lack of content in the communication. Some agents are just order takers and have not been trained how to guide a buyer through a purchase, so if I sense that the agent is weak I will try to help them by meeting them for the inspection, try to ask them questions (with their agent presents) to help them understand what it taking place.

If I get the impression that things are not going well, and in most markets appraisals are a concern, as well as buyers qualifying for financing, I will have conversations with the buyer's agent such as " So, assuming that the appraisal goes okay is there any reason that your buyers would not want to proceed with the purchase?" to find out what they are thinking. It they say "well, they think that the master bedroom might be too small for their furniture" then I might suggest that we measure the room and the furniture to see, rather than just say "Oh, thanks, you'll let me know if it does not fit" or something like that.

The role of the agents to facilitate the purchase process, meaning (IMHO) if we can uncover reasons that they buyers are having second thoughts then we either develop some work-arounds to make them feel better about the purchase or begin looking for new buyers. For example, in older homes buyers can get concerned about things like the dishwasher, water heater, etc. and may be unaware of home warranties and how they work.

The bottom line is that if both agents are doing their jobs diligently a buyer backing out should not be a surprise in most cases.

One more note---if the buyer's agent is not on top of things, I also will talk with the buyer's lender and if I sense that there are potential problems with qualifying, when I will suggest that we send the "buyer notice to perform" prior to the expiration of the contingency period to let the buyers and their agent know that we are monitoring their progress,

Particularly with appraisals, I show up and meet the appraiser, will have any supporting data to help establish the value of the property. One sale I had in December I brought the file that included the building permits. If I had not provided the permit for the addition, the appraiser told me she was not going to count it.

Happy New Year!
0 votes Thank Flag Link Fri Jan 2, 2009
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
Contact
In a standard residential purchase agreement, removal of contingencies requires the Buyer to sign a document indicating that contingencies are being removed. This document also informs the Buyer about the potential effect removing those contingencies has upon the Buyer's deposit. In some cases, a standard real estate agreement can have language added which makes contingency removals passive, meaning contingency removal occurs on a specific date or after a specific number of days.

Your question can only be accurately answered after a qualified professional has thoroughly reviewed the specific terms of the contract that you entered into with this Buyer. Since you indicated in your question that you have an agent, I recommend you address this question with him/her. If you are not confident in the answer received from your agent, I recommend you consult a real estate attorney for guidance.
0 votes Thank Flag Link Thu Jan 1, 2009
The first question that comes to my mind - since most escrow companies are closed on Sundays - is in what form were they notified? Frankly, the buyer's agent probably should have been the first party notified. It seems strange that this might not have been the case. That brings me back to question one. Did they receive an email, a fax, a person walked in and told them verbally? I would ask your agent to get as many details as possible from the buyer's agent, and hope that they can clarify things. If they can't, then the advice below, to seek an attorney's opinion is a logical next step. By the way, most real estate firms have an attorney on retainer, so if it comes to that, perhaps you should see if your agent's company can assist with that. Good luck with your situation.
Web Reference: http://BobPhillips.net
0 votes Thank Flag Link Thu Jan 1, 2009
You didn't mention why they canceled? Sometimes it's circumstances beyond their control. I'd be just reading into it right now, not knowing. At any rate, I've been in situations when a contingency hasn't been met by the 17th day at which point the other agent executes a "Notice to Perform" which gives you 24 hours to remove your continency and move forward or nix the deal. Any way you look at it, the deposit is given in good faith and most buyers are not willing to part with their money in the event that they cannot move forward with the deal. I try to go by the Golden Rule in all aspects of real estate. I'm not sure if you're buyer elected mediation / arbitration but my guess is, they will most likely fight for their money. I understand where you're coming from, you've lost time on the market, in a very difficult market and you want to recoup your losses. The problem is, while you are involved with any litigation, and releases aren't signed...this will tie everything up and make it difficult for you to move forward to market your property to get another buyer. At any rate, I can't give you a clear cut answer without knowing all the details involved. My other concern is that the timeframe for contingency removal took place during the Christmas holidays...and I don't know if you counted the holiday or excluded it? Busy and hectic time of year and I'm sure difficult for all due to the normal stress of the season, compounded with a real estate transaction...Yikes! My best advise to you would be to seek the advise of an attorney, especially because every situation and circumstance is different.
0 votes Thank Flag Link Thu Jan 1, 2009
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