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Today my husband and I received a phone call stating that the seller needs to raise the price $10,000. She had lied about having a second on the home initially and now needs to raise the price to pay that mortgage off. No one found out about the second mortgage until our title company went to have the title put on our names. She has already moved out of the home, 2 months ago.
Our current contract ends on on April 30th! Is there anything that we can do to stop her from raising the price and purchasing the home for the price we had agreed upon 3 months ago?
You have a signed and legally executed contract. Show up to closing and sign your side of the transaction. If she doesn't show, she's in default, and your contract will tell you what happens if the seller defaults. Don't default your end, and you've got recourse if she doesn't show. If you're not ready to close by April 30th and ask for an extension, then you've opened the contract back up, and she can make whatever changes she wants, and if you don't agree, you can walk away, losing any money you've already put into the transaction.
You won't really need an attorney until she doesn't show. If she shows to sign, you have nothing to worry about. If she doesn't show to sign, then you'll need an attorney if you're wanting to recoup damages, or just small claims court. Read your contract.
If you're not ready to close by April 30th and ask for an extension, then you've opened the contract back up, and she can make whatever changes she wants, and if you don't agree, you can walk away, losing any money you've already put into the transaction.
That's interesting. In Florida, if the parties fail to reach a meeting of the minds on a proposed modification, it doesn’t affect the enforceability of the existing contract, according to our association's legal FAQs.
a) consult your attorney ASAP to get proper legal advice as it pertains to your specific situation
b) the seller can not unilaterally change contract terms on you once you've agreed to and executed a legally binding contract, which is what your sales contract is.
c) that being said, if there is a second lien on the house, your sale won't go through until that lienholder is paid off, as you won't be able to have clear title. So you need to decide if you're willing to lose the house over that $10,000 (which, over the course of 30 years, is not that big a deal). Now, if you have written proof that the seller willfully withheld there being a second mortgage on the house, you should be able to pursue any and all legal remedies to recover your costs, even after sale.
That's interesting. In Florida, if the parties fail to reach a meeting of the minds on a proposed modification, it doesn’t affect the enforceability of the existing contract, according to our association's legal FAQs.
Ours either. Never heard of this "opening the contract back up". Once it is signed by all parties, its done. Can only be modified when agreed to and modification signed by BOTH parties. Thought that was a basic cornerstone of contract law?
That's interesting. In Florida, if the parties fail to reach a meeting of the minds on a proposed modification, it doesn’t affect the enforceability of the existing contract, according to our association's legal FAQs.
If the BUYER doesn't close by the April 30th date, then the contract is not valid anymore because it will have expired. If the buyer needs to ask for an extension of the contract, that opens the contract up for other terms to also be negotiated. The seller doesn't have to agree to the extension. If the seller doesn't agree, the buyer is in default by not closing before the closing date. Dates are important. Why wouldn't a closing date be important in a contract in Florida?
If the BUYER doesn't close by the April 30th date, then the contract is not valid anymore because it will have expired. If the buyer needs to ask for an extension of the contract, that opens the contract up for other terms to also be negotiated. The seller doesn't have to agree to the extension. If the seller doesn't agree, the buyer is in default by not closing before the closing date. Dates are important. Why wouldn't a closing date be important in a contract in Florida?
Definitely agree that the seller doesn't have to sign any addendum the buyer might ask for, and vice versa but, in Florida, the act of asking apparently doesn't do anything to "open it up for renegotiation" although, again, I agree that it might take a little give and take to get both sides to agree to sign the addendum. But, it doesn't just automatically void the contract.
Also, on our legal hotline FAQs:
Q: I have a buyer and seller who failed to close on the closing date. Does that mean the contract is null and void?
A: A closing date on a contract is not an expiration date. Therefore, if the parties don’t close on the closing date, the contract still exists. The issues then become why the contract failed to close and whether either (or both) parties breached the agreement.
Our current contract ends on on April 30th! Is there anything that we can do to stop her from raising the price and purchasing the home for the price we had agreed upon 3 months ago?
Clarification: Does your contract call for you to complete your purchase by April 30th? Or do you just have a closing scheduled for April 30th? (WHY HAS IT TAKEN THREE MONTHS??)
Are you represented by an agent? Is the Seller represented by an agent?
Hopefully, you are ready to close. If represented, maybe the agents can work things out by having the Seller's agent impress upon her that the contract it a done deal--and that she needs to follow through with the closing. If not, immediately (as in today) consult with a qualified real estate attorney.
Once a contract is signed by all parties, the Seller can not just raise the price. However, if the Seller doesn't have enough equity to pay off all of the mortgages (and other liens) on the property, then you're in a sticky situation. If she needs to bring money to the table--and she doesn't have it--your options are limited. Again, contact an attorney.
Definitely agree that the seller doesn't have to sign any addendum the buyer might ask for, and vice versa but, in Florida, the act of asking apparently doesn't do anything to "open it up for renegotiation" although, again, I agree that it might take a little give and take to get both sides to agree to sign the addendum. But, it doesn't just automatically void the contract.
I never said asking for changes automatically voids the contract. I don't see anything in my words that states that. They have a binding contract. It can only be changed if both sides agree. The seller can't just ask for more money. They agreed to a price, and she needs to sell for that price.
The Texas contract states that closing will be "on or before XXX date"... If the file does not close by this date, the only automatic extension there is, is if the title company hasn't been able to clear title OR if the seller hasn't completed Lender Required Repairs.
Other than those reasons, if the closing doesn't happen by the date, there is no longer a valid contract. Buyer and seller can agree to execute a new contract. If that happens, everything is open for negotiations again. That means that if the seller needs $10k more, and the buyer still wants the house, the buyer needs to be prepared to renegotiate that sales price.
On those same lines, if the buyer doesn't show up to close on time, the buyer is in default and all earnest reverts to the seller or the seller could sue for damages. However, if the buyer does show up and signs all their paperwork, but the seller doesn't sign and the seller defaults the contract, the buyer can sue for specific performance or damages.
Best to show up for closing even if you think/know the other side isn't going to so there is no evidence of you defaulting the contract.
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