Home Buying in Minneapolis>Question Details

Lise Siegel, Real Estate Pro in Minneapolis, MN

Once the bank and seller accept an offer I've heard they can still accept others. At what point would the

Asked by Lise Siegel, Minneapolis, MN Thu Dec 20, 2007

buyers know they have a firm deal and closing and what's to to stop the sellers from postponing the sale to stay in the house until the end of the redemption period?

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Banks can be tough to work with, but I have found that the majority of them want the property sold and the listing agent will work with me in good faith. There are purchase agreements (supplements) that can override the MNAR forms. Usually, it's the bank covering its proverbial bottom. Things like...adding $150 per day on to the buyer's closing costs if it doesn't close on the exact date on the P.A. Once it's signed and there's a final acceptance date, it's just like any other P.A.
0 votes Thank Flag Link Thu Jan 3, 2008
Lise,
The bank can entertain other offers until they sign they purchase agreement and deliver it to you. Typically they give you a verbal acceptance but while the offer is being processed another offer may come in and then they reject yours. Make sure your client is aware of this and get them everything they need (signed counter offer, earnest money) as soon as possible. Ask the listing agent to move the house to pending status once you have an accepted verbal offer. They may not do it for you but I have had them agree to once we had a verbal agreement and I delivered the earnest money.
Michael Doyle
0 votes Thank Flag Link Thu Dec 20, 2007
Standard MN Realtor Purchase Agreements do not have provisions to permit such a scenario. Some banks do require custom forms or addenda that can override the PA and allow the bank to consider and accept a different offer even after final acceptance. Often this is called a unilateral cancellation provision. Each bank seems to have their own paperwork so your mileage will vary.

There is a difference between the ability to accept different offers with unilateral cancellation and not performing on an accepted offer. In theory, the seller could be sued for specific performance for failure to consumate a transaction, however this could be overridden by some of the banks' addenda.

Most often though in a short sale situation, the standard MN forms are the only forms used. If the sellers are actively working to sell the home (which they are if they signed a listing contract and a purchase agreement) then it is usually safe to assume that they will perform as agreed.

As with any contract, there has to be faith by both parties that the other party will abide by the terms... I've heard of very few situations where a buyer or seller has litigated over a failure to perform.
Web Reference: http://www.AaronSOLD.com
0 votes Thank Flag Link Thu Dec 20, 2007
Lise......under what conditions have you heard that the Seller and Bank can accept offers after acceptance of one? If all contingencies (inspection, etc.) are met, I would understand that a deal has been made and it moves toward closing.

I'd like to know more of what you've heard.
Web Reference: http://www.toddnorsted.com
0 votes Thank Flag Link Thu Dec 20, 2007
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