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I went under contract on a house June 9, 2010. It is a standard Montana Buy-Sell agreement with a closing date of July 9, and we gave $1000 in earnest money, contingent on a home inspection. Sometime between our offer and the home inspection (all within the times allowed by the contract), water leaked into the finished basement causing a ton of damage. I sent an Inspection Notice to the seller within 10 days and she agreed unconditionally to my requests which included determining the source of the water leak, having the leak repaired, have a mold test done, and repairing the water damage all by qualified professionals. The Inspection Notice states, "If sellers and buyers agree to the remedies specified this document shall constitute an amendment to the Agreement to Buy-Sell. All performance required of sellers by this document shall be completed by 5 pm on July 6, 2010." Well, the work just began on July 6, and I am told the original closing date of July 9 is not possible at all. It will likely be the end of July or beginning of August before we close. My problem is that we agreed to a specific time line for this contract. I own a home which I am planning to rent, but before I do some work has to get done. I have to time renting it out with closing on my new house. I work full time and go to school full time. I took a session off school to get all this stuff done and move into my new house based on the July 9 close date. I had to take a double course load in August when I go back to school to get caught up and I can't be moving and trying to rent a house right in the middle of it; it even affects my financial aid. I like the house, but I'm mad I've stuck to my end of the deal, met every deadline like clockwork, and the seller didn't even start the work until the day it was supposed to be completed. I was also told there was no mold from the water, but when I was given a key by the agent (dual agent) and went to look there's mold, and no test has yet been done to determine what kind. She lied to my face because once the carpet and walls were out, it was in plain sight. I just want to know if you think I have grounds to back out of the deal at this point because the seller didn't meet the deadline, and get my earnest money back? I figure I might as well kiss the $500 I paid for the appraisal good-bye since it was already done. The only thing I am wondering about is a clause in the original buy-sell under "Financing Contingency" which says the "closing shall occur no later than 10 days after the closing date (Time for Completion)" Does that mean the closing can be extended 10 days in order for me to get my financing in order (which it already was as of June 9), or does it give the seller 10 extra days to get the work completed? What if the work still isn't done and we don't close by July 19 - then can I walk away and keep my money? Thanks for any help you can give. I just can't afford a lawyer, and I'm afraid if I try to get my own agent at this stage of the mess they'll laugh me out of their office.
You really need someone that knows your contract and local procedures to review your situation for best advice. Obviously it would be best if you had your own agent, or could hire an attorney. Next best is to ask the dual agent to provide advice on your contractual obligations, or check with their managing broker. If they are truly dual agent, they should be providing equal representation.
If your contract has a deadline for repair completion, missing that deadline would seem to give you grounds to terminate and get earnest money back. You will need to check if your contract allows for a cure period to address the issue (ours allows 3 days). Read your contract - it should specify the consequences of missing deadlines and options to deal with it. At the very least, you should get an addendum agreement with the new deadline if you are willing to give them more time.
If you really want the house, you should first review with the agent to see if any compromise is available to deal with the situation.
Thanks for any help you can give. I just can't afford a lawyer, and I'm afraid if I try to get my own agent at this stage of the mess they'll laugh me out of their office.
You really need a lawyer. IMO you can't afford NOT to have one right now. You may very well be able to get out of the contract, but only a lawyer can really help you unravel the details.
The OP highlights yet another reason to avoid a dual agency situation -- eventhe most honest agent cannot possibly serve as an impartial sounding board in this situation. There has been deception on some one's part, when mold is visible and lies have been told trust is out the window...
It may still be possible that this house, after repairs is the best option for the buyer,and it is possible that a closing very near to the original can be worked out, but it certainly sounds like emotionallythe OP just wants out, even if that means they need to try to buy another house and/ or screw up the rental situation.
I do not agree that an attorney should be the first call. The OP needs to talk about a "plan b" ( and maybe c d e and f) that makes sense. If just getting back the earnest money what about a place a live? What about the rental? What about time / energy?
If the agent is uncooperative then escalate to the broker. If the broker is unresponsive THEN call attorney...
I went under contract on a house June 9, 2010. It is a standard Montana Buy-Sell agreement with a closing date of July 9, and we gave $1000 in earnest money, contingent on a home inspection. Sometime between our offer and the home inspection (all within the times allowed by the contract), water leaked into the finished basement causing a ton of damage. I sent an Inspection Notice to the seller within 10 days and she agreed unconditionally to my requests which included determining the source of the water leak, having the leak repaired, have a mold test done, and repairing the water damage all by qualified professionals. The Inspection Notice states, "If sellers and buyers agree to the remedies specified this document shall constitute an amendment to the Agreement to Buy-Sell. All performance required of sellers by this document shall be completed by 5 pm on July 6, 2010." Well, the work just began on July 6, and I am told the original closing date of July 9 is not possible at all. It will likely be the end of July or beginning of August before we close. My problem is that we agreed to a specific time line for this contract. I own a home which I am planning to rent, but before I do some work has to get done. I have to time renting it out with closing on my new house. I work full time and go to school full time. I took a session off school to get all this stuff done and move into my new house based on the July 9 close date. I had to take a double course load in August when I go back to school to get caught up and I can't be moving and trying to rent a house right in the middle of it; it even affects my financial aid. I like the house, but I'm mad I've stuck to my end of the deal, met every deadline like clockwork, and the seller didn't even start the work until the day it was supposed to be completed. I was also told there was no mold from the water, but when I was given a key by the agent (dual agent) and went to look there's mold, and no test has yet been done to determine what kind. She lied to my face because once the carpet and walls were out, it was in plain sight. I just want to know if you think I have grounds to back out of the deal at this point because the seller didn't meet the deadline, and get my earnest money back? I figure I might as well kiss the $500 I paid for the appraisal good-bye since it was already done. The only thing I am wondering about is a clause in the original buy-sell under "Financing Contingency" which says the "closing shall occur no later than 10 days after the closing date (Time for Completion)" Does that mean the closing can be extended 10 days in order for me to get my financing in order (which it already was as of June 9), or does it give the seller 10 extra days to get the work completed? What if the work still isn't done and we don't close by July 19 - then can I walk away and keep my money? Thanks for any help you can give. I just can't afford a lawyer, and I'm afraid if I try to get my own agent at this stage of the mess they'll laugh me out of their office.
As suggested, see a real estate lawyer and maybe one referred to you by a real estate agent. In our city there are 2-3 lawyers that seem to handle most of the closings.
My agent told me she rarely sees sellers "keep the earnest money no matter the reason for cancelling". It's $500-$1000 and not worth the hassle of a fight, just give it back.
I have repairs to make as the seller and my deadline is closing.
Maybe your area has a lawyer referral service (check the yellow pages)and you can get a 30 minute consultation for maybe $50-$75. Some lawyers give free initial consultations. It's an event that gives you more info on the problem you have, and what your options are.
Good luck......and I hope everything works out for you.
I can only relate my personal experience, which in no way is a predictor of what will happen in your case, but sometimes it is comforting to hear what happens in real life....
I sold my house in 2008 to a buyer who essentially wanted to be a glorified renter (no money down, folding closing costs into mortgage) etc. A few days before closing she decided she didn't want the house. Simply got cold feet. That's it. Oh she and her realtor gave some bogus reasons, but they were very thin. Even my realtor agreed that it was nonsense.
Nevertheless I was pressured HARD for a few weeks to give back the earnest money--even my own realtor joined in on this because she has to work with the real estate community and didn't want to besmirch her own rep. I sat on the money for a while, until I successfully sold the house to my next buyer. Then I gave Buyer #1 her money back.
It is unfortunate that you don't have your own realtor, but like I said, even in a situation with "opposing" realtors, I was pressured by both to give back the earnest money. And hey, if you don't get it back, you've got a few years (I think it's three?) to sue in small claims for it. No lawyer necessary.
I suggest you talk to the title company's closing agent assigned to your contract. This title company should be holding your EDM (Earnest deposit) in escrow there. I do believe you can cancel the contract due to the failure of the seller to abide by the schedule and it certainly is worth dropping over to have a conversation (free) before you get with an attorney. It is my experience that title companies always return the EDM to the buyers unless buyers sign a release to give the money to the seller in a failed contract. You, of course, have no intention of releasing the funds to the seller.....can't hurt to try to deal with this yourself at least inquire.....
In Texas, if there is something that happens, the seller must put the house back in the original condition the buyer agreed to buy it in. If not, the buyer can terminate and retain earnest money. If the seller is doing the repairs and can't complete the repairs, the contract automatically extends 15 days, and then 15 days, etc... as long as the repairs are being worked on.
Does your contract have automatic extensions? You need to read it carefully as we don't know if you retain your earnest money or not if the sellers are working diligently to get it all fixed.
we signed a rental agreement for 1200 mo. we put 500.00 down deposit the people moved out and we are suspose to close on dec 9th we want to back out before the closing can we?
we signed a rental agreement for 1200 mo. we put 500.00 down deposit the people moved out and we are suspose to close on dec 9th we want to back out before the closing can we?
What is your question in relation to? Are you the OP posting under a different name?
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