U.S. CitiesCity-Data Forum Index
Happy Thanksgiving Day!
Go Back   City-Data Forum > General Forums > Real Estate
 [Register]
Please register to participate in our discussions with 1.5 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Jump to a detailed profile or search
site with Google Custom Search

Search Forums  (Advanced)
Business Search - 14 Million verified businesses
Search for:  near: 
 
Old 09-24-2009, 03:32 PM
 
92 posts, read 227,368 times
Reputation: 82

Advertisements

My friend put an offer in on a foreclosure. His offer was accepted, he signed the PA & the ammended PA last week. The inspection was last night and was really good. Then today his realtor calls him saying he just received a phone call saying the bank (who currently owns the foreclosure) just accepted another offer. Can they do that? What about the money he just spent to have the house inspected?? Will the bank reimburse him for that?

I was under the impression that after the buyer signed the PA the Seller could not accept any other offers. Any advice?
Reply With Quote Quick reply to this message

 
Old 09-24-2009, 03:40 PM
 
Location: Tempe, Arizona
4,511 posts, read 7,419,532 times
Reputation: 2106
The banks usually include language in their purchase addendum that they can accept new offers up until they sign the addendum. Did your friend actually get the addendum back from the bank with the bank's signature?

The way this works is the bank will verbally accept, then send their addendum for the buyer to sign, then the bank signs after they get the buyer's signature. All of this can take several days.

Up until the bank signs, they can still accept another offer. Starting inspections prior to bank signature is a risk, but sometimes necessary given that some banks start the clock ticking on inspection period from verbal acceptance. In this situation, your friend is probably out the inspection cost.
Reply With Quote Quick reply to this message
 
Old 09-24-2009, 03:49 PM
 
Location: Boise, ID
5,511 posts, read 10,720,442 times
Reputation: 4897
That depends. If the property was being sold as a short sale (which would actually be pre-foreclosure, but some people don't know the difference, so I'm just saying), then in the contract somewhere, there should be something that says the sale is contingent on bank approval. In that case, the seller's signature really means not much of anything, and the bank can opt to reject the first place offer and take a different one, even if it isn't what the seller agreed to. Really lousy of the other agent not to let your friend know there were other offers on the table before your friend spent money getting an inspection done.

And no, the bank probably won't reimburse for the inspection, but you might be able to get the actual buyer to buy it from you, since they will probably want to have one done anyway.

If it really was a foreclosure, that the bank already owned, then I would say he had better double check his paperwork for any contingencies he didn't remove or deadlines he didn't meet. Because on a bank owned, usually if the buyer and seller have both signed, the seller cannot just choose to take another offer.

UNLESS they were accepting another offer in backup position and you still have the first chance to buy the house. You said your friend has a realtor, they should be able to tell him why this was a legal thing, or why it wasn't.
Reply With Quote Quick reply to this message
 
Old 09-24-2009, 03:55 PM
 
Location: Boise, ID
5,511 posts, read 10,720,442 times
Reputation: 4897
Quote:
Originally Posted by rjrcm View Post
The banks usually include language in their purchase addendum that they can accept new offers up until they sign the addendum. Did your friend actually get the addendum back from the bank with the bank's signature?

The way this works is the bank will verbally accept, then send their addendum for the buyer to sign, then the bank signs after they get the buyer's signature. All of this can take several days.

Up until the bank signs, they can still accept another offer. Starting inspections prior to bank signature is a risk, but sometimes necessary given that some banks start the clock ticking on inspection period from verbal acceptance. In this situation, your friend is probably out the inspection cost.
Yeah, that would be a perfect example of an unmet contingency. On our offers, there is a box on the signature page that says "signature subject to..." and you mark "counter offer #___" or "addendum #____". There's one on the buyer's signature place for addendum and one on the seller's signature place for both. If there is something like that, then it isn't a done deal without that paperwork signed.

The only difference locally, is that they don't accept verbally, they accept with a signature subject to an addendum. A verbal acceptance is worth as much as the paper its written on. Verbal communication is only negotiation, nothing is accepted until it is signed.
Reply With Quote Quick reply to this message
 
Old 09-24-2009, 04:00 PM
 
Location: Tempe, Arizona
4,511 posts, read 7,419,532 times
Reputation: 2106
Quote:
Originally Posted by Lacerta View Post
... The only difference locally, is that they don't accept verbally, they accept with a signature subject to an addendum. A verbal acceptance is worth as much as the paper its written on. Verbal communication is only negotiation, nothing is accepted until it is signed.
I agree, however, the banks play by their own rules. You either go along or don't get the house. At best, we get an email from the bank's agent confirming the acceptance along with the addendum to sign. If you've seen a Fannie Mae agreement, they specifically state that all time frames start from their "verbal acceptance" date.
Reply With Quote Quick reply to this message
 
Old 09-24-2009, 04:24 PM
Status: "It's 5 o'clock somewhere." (set 5 days ago)
 
Location: Mountain Ranch, CA The heart of Calaveras County
6,136 posts, read 11,468,630 times
Reputation: 4895
They did that to me last week on a full price, no inspection contingency offer. The listing agent said they took another offer because it wasn't for a USDA loan. I'm still failing to grasp why an asset manager cares about the loan types.

But then again, If I ever meet someone who confesses to be an asset manager, I may not be able to control my tongue.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $84,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Real Estate

All times are GMT -6. The time now is 07:31 PM.

2005-2014, Advameg, Inc.

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25 - Top