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This is not true in Oregon. Since it is calendar days confirmed by the agent, the OP should get the earnest money since the buyer is terminating outside of the terms of the contingency. Unless there is another clause in the contract that works in conjunction with the inspection clause that would change that or the state allows for the right of recision.
An agent is absolutely held to the basic standard of calculating dates and explaining them to their clients, at least out here. In Oregon we are expected to be able to completely summarize and explain every single form we have to our clients. What we can't do is offer a legal interpretation of the agreement. Those are two different things.
I also find it interesting that in other states earnest money disputes would hold up the sale of a house. Out here you can terminate a contract but have an earnest money dispute going on at the same time. So the seller can still move forward with another buyer, while the earnest money gets hashed out. The buyer and seller just release each other from the agreement to purchase, but the earnest money is still held in escrow until the judge orders the release.
I'm a little confused at how you do this.
so the seller would get all the earnest money? and it wouldn't go to damages? I'm far from an expert in how things work, but I thought you generally go by assessing the damage done by the delay or whatever.
If that is the case, what is customary out there for earnest money? loosing $500 on a deal over a technicality is one thing, but $10K is something else.
In my area, offers are on an offer sheet which isn't really binding in the slightest. No money changes hands, contracts are drawn up generally after the inspection. Money gets put down at contract.
TheCityTheBridge: I think that your response is inappropriate when you say "you can burn your house" now that this buyer is in default. I am requesting you respect when writing notes here. Under this agreement and based on Paragraph13(b) the buyer cannot terminate the agreement after he accepted the property, PERIOD. And, if he does, consequences should happen. The buyer didn’t revoke the inspection proposal, he signed it and I signed it in the stated period of time under the agreement, PERIOD. In regards to this comment: “In America, we don't penalize people for deciding not to go through with an agreement”, I believe you don't live in this country. In America we do penalize people for deciding not go through agreement, many cases like this happen every day in house rentals, hotels, car rentals, you name it, but apparently in the real estate there is a walk-out way without penalty. I suffered harm, of course, read my previous posts, and of course I lost money, did you have the chance to read the whole thread?
Why is it that so many people get lost in the details, sabotage their goals, get in their own way, and cannot keep their eye on the prize. Not just in real estate, I see it everywhere. I really am convinced that the general population is incapable of thinking, but quite adept at feeling.
Why is it that so many people get lost in the details, sabotage their goals, get in their own way, and cannot keep their eye on the prize. Not just in real estate, I see it everywhere. I really am convinced that the general population is incapable of thinking, but quite adept at feeling.
It's easier for us looking from the outside in. I can look at a friends problem and know what the best course of action should be, I am not emotionally involved. Looking at my own issues, I am lost as hell!
so the seller would get all the earnest money? and it wouldn't go to damages? I'm far from an expert in how things work, but I thought you generally go by assessing the damage done by the delay or whatever.
If that is the case, what is customary out there for earnest money? loosing $500 on a deal over a technicality is one thing, but $10K is something else.
In my area, offers are on an offer sheet which isn't really binding in the slightest. No money changes hands, contracts are drawn up generally after the inspection. Money gets put down at contract.
Out here our contracts specify who gets the earnest money when. Damages don't have anything to do with it. A buyer loses their earnest money if they terminate outside any of the agreed upon contingencies.
The three times my sellers got the earnest money were
1) The social security number put on the lender application didn't belong to the buyer. Fraud, my seller got the earnest money.
2) The buyer's parents were gifting her cash for the house purchase. They backed out. Parental change of heart is not a contingency in the contract. My seller got the earnest money. (I felt bad for the buyer who was the one that put up the earnest money).
3) The buyers were moving from one city to my city. They caved to parental pressure to not move away. Parental pressure is not a contingency in the contract, my seller got the earnest money.
None of these scenarios cost my sellers any money, as the houses went under contract quickly after going back on the market, but they aren't contingencies in the contract. I've had agents forget to put in a parental gift as a downpayment in the contract. Had those deals not closed, my seller would get the earnest money for financial misrepresentation. In one case where it was dubious, I made it clear to the buyer agent that my client would be seeking the earnest money if it didn't close.
I do watch and encourage sellers to keep earnest money under $7500 which is our small claims court limit. The $10k put up in the OP's situation would force mediation and arbitration to get the earnest money but legal fees are recoupable per our contract to the prevailing party.
Technically, you have a claim. However, in all my years in the industry, I have NEVER seen a seller able to claim an earnest money deposit over this. Further, as others have pointed out, the buyer can legally tie up the property.
I have seen buyers walk at the closing table. That is why I, as an agent, never let the seller and buyer talk face to face. The slightest thing (a comment by the buyer not liking the wall paper, etc) can blow a deal. And, again, I have never seen a seller win a case trying to force the buyer to close.
Just go sell the home to someone else, and don't lose any sleep over this.
Delivery is a necessary component of a legally binding contract. An offer becomes a contract when signed by all parties AND delivered to ALL parties
Ah yes thanks for the reminder
signed, sealed DELIVERED!!!
Retired my real estate license just as email was getting popular and in my state delivery to the broker/ agent via fax counted yet I vaguely remember that power of attorney for said transactions was often given when folks were out off state to prevent such scenarios occurring due to time, empty fax machines etc...
Conducting real estate transaction via Iphones and scanned pdf attachments would probably drive me crazy today.
Last edited by UNITYinternational; 02-12-2014 at 01:56 PM..
TheCityTheBridge: I think that your response is inappropriate when you say "you can burn your house" now that this buyer is in default. I am requesting you respect when writing notes here. Under this agreement and based on Paragraph13(b) the buyer cannot terminate the agreement after he accepted the property, PERIOD. And, if he does, consequences should happen. The buyer didn’t revoke the inspection proposal, he signed it and I signed it in the stated period of time under the agreement, PERIOD. In regards to this comment: “In America, we don't penalize people for deciding not to go through with an agreement”, I believe you don't live in this country. In America we do penalize people for deciding not go through agreement, many cases like this happen every day in house rentals, hotels, car rentals, you name it, but apparently in the real estate there is a walk-out way without penalty. I suffered harm, of course, read my previous posts, and of course I lost money, did you have the chance to read the whole thread?
I'm sorry you took offense, but you continue to make unsupportable claims about this situation. I do, in fact live in America, and I do, in fact, know quite a bit about contract law. Breach of contract is not about punishment. It is about making the aggrieved party whole. You are whole.
In the case of house rentals (assuming you are talking about the early termination of a lease by a renter), the landlord is only entitled to payment from the former renter for the lease agreement rent price for the amount of time it would take a reasonable landlord exercising reasonable diligence to re-rent the premises (this is called "cover" of the breach). Hotels are only entitled not to refund a cancelling buyer if they cannot rent out the room for the night (not that very many people challenge hotels that claim "no refunds"). The same is true for car rentals. Lots of people break the law in America, and lots of people get away with it. But American contract law is not about penalizing people for breaching contracts.
You have not stated what money you lost. You said something about bringing $20k to the table, but I understand that you still have that money--you did not have to pay it for anything.
You also said something about choosing not to rent out the property and instead selling it--this buyer's decision not to complete the purchase had nothing to do with your choice to sell the property. The point is you still have the property, PERIOD.
UnityJAX: While the seller is "thinking" between Jan 30 - Feb 5 about the repairs, buyer can change their mine and terminate the agreement, but it would be after the contingency period that ended on Feb 1. The buyer defaulted the agreement and he wants to walk away without any consequences.
Requesting repairs was a new offer that the buyers rescinded before the new offer to purchase at said price with said repairs was accepted by the seller and delivered to the buyer.
Give the peeps there money back is my vote. Even if the contract still seems fuzzy and grey just give it back and keep your Karma good!
Question: Why the huge earnest money deposit anyway? I only ask because the folks I know conducting million dollar plus deals from out of state usually have competent realtors and attorneys handling business for them. Otherwise, folks usually go with $100-$.
TheCityTheBridge: Even If I made unsupportable claims about my situation, you shouldn't have said in an ironic manner "You still have the property. You can rent it out or sell it to someone else or live in it or burn it down". You are making a bad statement that is considered inappropriate and because of that the rest of your comments are ignored by me as I don't give you any credit or respect.
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