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My parents were looking at a house. The price that was listed for this house was $560,000. There was no one that offered that amount so the price went down. The price went down to $500,000. My parents offered $510,000 and they didn't respond. Then my parents offered $520,000 and they said okay we think about it and they get into discussion. The seller then asked for 530,000 and parents took a while and agreed. My parents paid for a real estate agent to do the paperwork. They then paid those house inspector to check if there was anything bad in the house or in the backyard such as if there was anything bad about it. They checked and there was nothing wrong in the house.
Thus my parents were just waiting for the seller to sign the paperwork to purchase the house. They then found out from the real estate agent that the seller of the house now increased the price from $530,000 up to $550,000. My parents are outraged as to how can the seller do this especially since my parents hired a real estate agent and also paid money to have the house inspected before making the purchase. They had previously looked at other houses and did inspections but those few times they did, they were told there were some stuff in the house that wasn't good so my parents didn't buy the house and thus they paid for those house inspections out of their own pocket which we know is a cost.
My questions are
1. Since the seller never signed anything, I understand they do not have to sell the house. But has anyone here purchased a house or know of anyone who has where they had it inspected and had a real estate agent do the paperwork then agree to buy, only to have the seller increase the price?
2. My parents are upset that they actually bidded more for the house than the other potential buyers. At first 510,000 was offered but they didn't respond. Then 520,000 was offered from parents and they said they wanted 530,000. My parents eventually said okay to that. Then paid for house inspecting and real estate agent. This cost them $1000 total. Do they have any chance of getting either the house inspecting or real estate agent fees back? My parents are upset because they told the seller okay we are going to have an inspector inspect the house then and since they allowed it, we assumed we were going to purchase the house at 530,000. I mean if they told us to not pay for a house inspection because they are not 100 percent sure if they are selling the house, then obviously my parents aren't going to pay to have it inspected and thus wouldn't be upset like they are now.
3. How unethical is what the seller doing? It doesn't make sense how you were offered a price, you didn't accept the first one at 510k. Then we offered 520k and then they said make it 530k and my parents finally agreed. Then did all the paperwork and inspecting and now seller wants 550k. Does anyone know why a seller who do this the last minute? Is it because they thought my parents were willing to pay 530k so they thought it was easy and then now make it 550k? The thing is no one even wanted to buy the house at 560k. It was only when the price was dropped to 500k, they got offers. And once my parents offered 520k, others couldn't negotiate no more.
4. I know that if they put the house back at 560k, not much people will be interested in this house. We are also certain no one would offer 530k like us as well for it. So are they basically just doing this to test buyers?
5. When my parents look at other houses, i guess the number 1 thing to do is make sure have the seller sign a contract that they will be selling us the house if we tell them we are paying the money to inspect the house and a real estate agent? Basically what they do is call a real estate agent then look inside the house and then if they like it, they discuss the price and then if the seller and us agree in the amount, then my parents would pay for the house inspection. Otherwise they go and check another place.
Something is missing… When your parents submitted the offer through their real estate agent, and after offer, counter offers, and finally an agreement, didn’t the two agents (buyer & seller) have a purchase contract signed by both parties?
Around here, no one spends a dime on inspections, etc, without a signed contract. Sounds to me everyone was just talking about prices, doesnt really matter what the figures were. Without a signed contract, it's just that.... talk.
So your parents didn't sign a contract contingent on a home inspection. And they didn't wait until it was a "contract"...ratified, signed by both parties...until they went and spent money on the house.
Guess the needed more than someone who only did paperwork. Why do I get the sinking feeling there was only one person involved who did paperwork. No buyer's agent who contracted with the buyer to serve the buyer and no seller's agents who contracted with the seller to serve the seller's purposes.
Around here, no one spends a dime on inspections, etc, without a signed contract. Sounds to me everyone was just talking about prices, doesnt really matter what the figures were. Without a signed contract, it's just that.... talk.
yup.
Not sure where you live and things are done differently in different places. Also real estate laws vary by state.
That said, if there's no signed contract, there's no binding contract. I too don't understand why your parents would do an inspection before having a contract. Locally, it's actually the bank that arranges that, and of course passes the fee on to the buyer.
I also don't understand why they're paying the realtor. It's usually the seller that does that.
The seller is doing that because (I think) he thinks your parents really want that house. The ball is in their court now: how badly do they want that house?
My parents paid for a real estate agent to do the paperwork.
I've never heard of a buyer ever paying a real estate agent for anything. Not sure why they would do this.
Quote:
Originally Posted by Fibers
They then paid those house inspector to check if there was anything bad in the house or in the backyard such as if there was anything bad about it. They checked and there was nothing wrong in the house.
I've never seen an inspection find "nothing" wrong. If an inspector told me he found nothing, I'd question if he even entered the house and even paying him.
There seems to be a lot missing here or a lot that doesn't make sense.
To summarize:
It's pretty rare for a buyer to pay for a home inspection prior to having a signed purchase agreement in place.
Buyers don't usually pay a realtor anything until and unless a home is actually purchased. Please explain why your parents had to pay a realtor.
Nothing signed by the seller or buyer means there was no contract. The sellers can do whatever they want since there is no binding contract in place.
It doesn't sound as if your parents put down any earnest money. Earnest money is considered a "good faith" showing that your parents intended to proceed. (I'm not suggesting they should have done so in this case, but earnest money is a sign of a contract being in place.)
Are your parents working with a real estate agent? I would suggest that they need to find an agent that will take the time to explain the typical buying process to them. If they are using an agent, something is missing here.
OP - the unfortunate truth is your parents messed up. As everyone else has pointed out they should have waited to get a signed contract. Tell them to walk away from this house. Seller seems like a nut job. And get a full time realtor next time. Not some to do "paperwork", whatever that means.
I have a feeling that this all transpired in NY, possibly on LI, where it is common to inspect prior to contract ratification via attorney review.
It is far outside my location and area of practice but it seems to me like a huge error to inspect before seller signed an intent to sell at the agreed price based on an assumption that they were going to move forward.
Sellers do not have any implicit code of ethics to honor, other than personal. Seller probably rationalizes the maneuver as "just business, not personal," or "we had to do what is best for us because 'yadda, yadda, yadda...,'" or some other drivel.
I think they should submit another offer at $520,000 just to stand their ground and show the seller that they mean business and will not increase their offer. The seller should take it or leave it. If he leaves it, then the seller should come back 6 months later with the exact same offer when the house still hasn't sold. LOL
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