Seller is asking the compensate due to delay of escrow closing

Asked by Echo Liu, Westlake, Daly City, CA Sun May 5, 2013

Seller is asking the compensate due to delay of escrow closing. Escrow close date is March 30 and today is may 5th. The delay is mostly bought on by the seller's title company, appraiser making several mistakes and lender's additional review causing us a 3 week delay. Seller claim the delay is going to let him face the penalty of his purch of new house and reject to sign extention unless we compensate him. but both buyer and seller have signed closing escrow documents, and it going to recode on May 6th. what will happen, if the buyer doesn't agree to pay seller's compensate?

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7
Sally Rosenm…, Agent, San Francisco, CA
Mon May 6, 2013
I agree with Steve. Where is your agent? Your agent should be taking care of this for you!

Good luck!

Sally
Web Reference:  http://www.sallyrosenman.com
1 vote
Echo Liu, , Westlake, Daly City, CA
Tue May 7, 2013
Thank you for all your replies. But escrow has already closed on Monday, May 6. My agent told seller's agent that escrow has closed, there isn't a negotiation anymore. I don't know what will happen next, but finally I have moved into the house already.
0 votes
Steven Ornel…, Agent, Fremont, CA
Mon May 6, 2013
Hi Echo,

As you indicate, both parties have signed escrow documents. If you did not sign a contract addendum or any escrow instructions to authorize payment to the Seller for the delay, it would then appear you will close escrow today without doing so.

Where is your Agent?

-Steve
0 votes
Hi Steve,

Thank you for your advice. Yes, the escrow has closed on Monday, May 6th. And my agent has told seller's agent the transaction is closed there isn't negotiation anymore. I have moved into the house already.
Flag Tue May 7, 2013
Rob Regan, Agent, San Francisco, CA
Mon May 6, 2013
If it can close today, and the seller is upset with delays, why would the seller want to cause further delays? They would probably have to have some cost on their side that makes even further delays worthwhile and it is unclear from your description if that is the case. We would need to hear the seller's side of the story to have a truly informed opinion here on what "might" happen next.

It does sound as if the Seller has the right to cancel the contract since you are well past the contracted close of escrow date - so they can ask for compensation in exchange for not cancelling the contract. But if both buyer and seller hold their ground, the result is either an even more delayed closing, or a cancelled contract and possibly one or both parties hiring attorneys to battle it out.

Please note, I am not an attorney and this is not legal advice.
Web Reference:  http://www.SFisHOME.com
0 votes
Cindy Davis, Agent, San Diego, CA
Sun May 5, 2013
I don't quite understand this...if the mistakes and delay is on the seller side...how can they expect the buyer to pay? Doesn't make sense.

Usually, if one side is late, they compensate the OTHER SIDE. Do you have any agent working with you? If so, ask your agent for help. If not, seek legal advice.

Best of luck.
0 votes
gabrielle b…, Agent, San Francisco, CA
Sun May 5, 2013
There are a number of details missing and the best course of action is to work with your agent and his or her broker on getting this resolved.
0 votes
Joseph Chavez, Agent, Pleasanton, CA
Sun May 5, 2013
Dear Buyer,

What are the terms of compensation being requested ?
0 votes
The seller is requested the compensation now. But what I worry about is if the title company record on May 6th, can I, the buyer, move into the house since we have already finished all the transaction. The only one document is missing is the amendment of extension which the seller rejects to sign it.
Flag Sun May 5, 2013
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