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We have a signed addendum with a REO seller. The closing date has gone by, but seller won't close escrow because there were HOA dues discrepancies.
This is an all cash transaction so we have already wired all funds to the title company.
However, we now want to rescind the contract since the seller did not close escrow within the closing date specified in the contract.
Is the contract still valid once the closing date has expired?
If we rescind a contract with an expired closing date, can the seller still keep our earnest money deposit?
Is there any chance the seller can go after more than the earnest money deposit?
Thanks!
You need to read your contract as we don't know what it says. In Texas, closing dates can be automatically extended if something comes up about the house, like something wrong with the survey or title. Without knowing if your contract has automatic extensions, we don't know what your recourse is.
Read the REO contract addendum, it's in there. Also, it would help if you recognized that a bank seller is not the same as a private seller. Banks don't have the flexibility that "regular people" have. If you treat an REO transaction like a "regular" transaction, you're setting yourself up to be majorly stressed out.
Quote:
Originally Posted by zakenjanei
We have a signed addendum with a REO seller. The closing date has gone by, but seller won't close escrow because there were HOA dues discrepancies.
This is an all cash transaction so we have already wired all funds to the title company.
However, we now want to rescind the contract since the seller did not close escrow within the closing date specified in the contract.
Is the contract still valid once the closing date has expired?
If we rescind a contract with an expired closing date, can the seller still keep our earnest money deposit?
Is there any chance the seller can go after more than the earnest money deposit?
Thanks!
Agree with everyone above. Check out the contract as it should be in there.
In a transaction with an REO seller you sometimes have to accept that there will be delays and there isn't much you can do but wait. It's common for an REO seller to decide to question the validity of outstanding HOA dues, RE taxes, utility bills, fines for violations at the last minute even if they had previously been made aware of these same issues earlier in the game. These transactions are handled by several people and even sometimes several people at several different corporations/investors so getting the closing done in a timely manner can be frustrating.
As an escrow officer at a large title company who's business is 90% REO I can't tell you how frustrating this can be for us, the buyers, the agents and the mortgage broker.
The seller will also more than likely expect you to be ready the moment they are as well. Since it sounds like you have already deposited your closing funds into escrow you being ready shouldn't be much of a problem. Good luck and hope you close soon.
Well, hopefully it's been resolved since the OP was almost a year ago.
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