Question Details

Maureen Veli…,  in Tarpon Springs, FL

Termites! I need help! I had a final walk through today. Mind you all inspections were done previously.

Asked by Maureen Velilla, Tarpon Springs, FL Sun Feb 1, 2009

And came back clean. Well TODAY...there were hundreds of swarmer termites laying dead in all of the corners.My buyers want to back out (they are an older couple, using their life savings). The sellers have always aggressively treated to prevent termites, and have a current contract. Has anyone had this happen to them? How do I best protect my clients (buyers)? Is this a lost sale? Are there repercussions to them for backing out?

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If the Buyers signed the inspection contingency release and the bank does not require a termite certification since there IS termite insurance on the property ,the house will have to be treated by the provider of the termite contract . (Was this information on the Seller's disclosure ? )
I would inform the bank about the status and see if they require a clear termite at this stage.
The buyers would get a warranty after the treatment and I would suggest they keep up the termite insurance and close. OR if they decide they do not want to close
The only loss to your buyers ,as I see it, is their deposit if the Sellers want to be technical, but now the listing agent will have to disclose recent termite activity and treatment to the future buyers.
1 vote Thank Flag Link Mon Feb 2, 2009
First, I suggest you speak to your Broker about this problem to make them aware of what is going on. I also suggest you bring back the company that did the termite inspection for a reinspection. If there are wood destroying organisms (WDO) in the property than they must be treated in order to have a clean WDO in order to close whether there is a mortgage or not. Also, if the sellers have a current contract then the sellers should bring back the company to retreat.
1 vote Thank Flag Link Sun Feb 1, 2009
Are the buyers willing to purchase and pay a GC to rehab the property? If not, then have the buyers waived all of their contingencies? If not, then it's possible they could use the financing contingency. Hopefully, you took a picture of those dead termites, and you could give a copy to the couple to show the lender and ask if they're still willing to lend on the property. Get something in writing from the lender stating that they're unwilling to lend on that property, or that they're only willing to lend on that property after the seller corrects the termite problem. This way your buyers can either use this to force the seller to lower the purchase price, or they can back out using one of their contingencies. However, if they already waived all of their contingencies, then it's probably time for your buyers to review their contract with an attorney.
1 vote Thank Flag Link Sun Feb 1, 2009
Something similiar happened to me but I was on the listing side. We had done a termite/moisture inspection and gotten a clear but we had to have a revisit since the original was too old for the lender. When the company went back out, there were dead swarmers on the windowsil. We had to have the home treated. Consult your broker, consult your attorney. When I am on the buyer side, I frequently have the buyer order and pay for the termite inspection so they own and possess the reports and the subsequent warranty. Review the policy that the seller has and make sure that any warranties go to the buyer and that the buyer will have recourse after closing if there is still a problem. Don't know what your contract says and if it has a 'subject to cap' section but if the lender finds out about the problem and dictates action, it's hard to fight it - if there is a lender, call them. I don't know if termite infestation is a cause for backing out in your case, especially if the seller can fix the problem.

Dp2, what company are you with? It's not coming up on your pic/profile.
0 votes Thank Flag Link Mon Feb 2, 2009
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