Posted on 04/24/2020 9:37:55 AM PDT by CaptainPhilFan
Not knowing what state you are in, but, there has to be a timeline on the contact....stipulating something like “ this transaction shall be closed on or before (date inserted) or this contract will be null and void). You might not even have an agreement if the life of the contact has expired. Time is if the essence in every RE agreement. I am thinking this buyer was unable to get financing for whatever reason, and is now trying to become an LLC to reapply for a loan. Realtors are held to a higher standard when negotiating a real estate purchase to prevent an unfair advantage, which sounds like what has happened to you. If what you are saying is accurate It seems to me that almost every aspect of this contract has been infringed. If you want to go forward, contact your realtor or attorney, insist that you are given a lenders commitment letter within 72 hours, demand an addendum specifying a timeline that this shall be closed within fourteen days or it is null and void, and a correctly resigned acceptance from the buyer and what entity is actually the buying signatory. If they are not willing to do this, then you have nothing. This has cost you time and money, which IMO, you should receive the earnest deposit at a minimum. The LAST THING any Realtor wants is a complaint filed with their local Board of Realtors, which you should do if you feel you have been taken advantage of. Were you TOLD he is a Realtor or was it disclosed in writing in the agreement, which it must be. Do you have your own attorney?
the contract rules
Usually before you can cancel or keep a deposit you have to send the buyer a Notice to Perform within usually 24-48 hours. If they don’t perform in accordance with the contract you can do as the contract allows.
I don't know. I suppose it's possible he could get the financing, but it doesn't sound like it's going so well. If you think you may want to try to save the deal, you or your lawyer should find out who the buyer's proposed lender is and talk to the lender directly about status. If you don't get a good feeling, move on. No offense to any brokers or realtors who may be reading this, but I would trust advice from the lawyer more than the brokers. The brokers are primarily motivated to get the deal done so they can get paid. Since they have already found a buyer, they are incentivized to keep the deal alive as long as they can. The lawyer's job is to solely represent your interests and give you honest advice.
As another poster pointed out, there is likely a financing contingency in the contract. Usually, that contingency provides a certain period of time for the buyer to obtain financing and gives the buyer the option to either waive the contingency or terminate the contract and receive a return of the deposit if financing hasn't been obtained during that period. The period is usually thirty or forty-five days after the contract is signed. I have never seen a situation where the financing contingency can be used to extend the closing date without the seller agreeing to it.
I'm sure your contract specifies that time is of the essence, so in a typical deal if the stated closing date has passed and you have not granted an extension you can terminate the contract and have the holder of the deposit distribute it to you.
Of course, an important consideration for you will be whether you can quickly find another buyer if you terminate. I'm in the MD-DC-VA area and the market has not noticeably softened due to the virus. Your market may be different, of course.
Thanks everyone for your help and advice. Without it I wouldn’t be confident enough to stand up for myself. FReepers rock :) <3
This is my the reply I got from the Real Estate agent:
“I tried calling you guys last week to let you know that the appraisal came and and they are good with that. Still waiting on **BANK NAME**.
I talked to **BUYER** again today, he’s willing to add to the deposit to show you that he is very serious and still intends to close as quickly as possible. I was not able to get a timeline or what the hold up is at the bank”.
****************************
This was my reply back:
We’re going to take the weekend to decide what we want to do. You know by now this is getting hinky and is very unfair to us.
We are being good sports by letting this play out, current health crisis aside. I knew this guy was not legit from the start.
We will likely want a signed and time-sensitive extension.
We were not told about the LLC and package deal when we accepted his offer - that right there should make it null and void.
If we can salvage this we will but we’re not waiting much longer.
We can relist or rent it at this point.
Looks like you are on the right track. Good luck!
Take KevinB’s advice in post #14.
Don't care if he wants it or not, he is in violation of the time limit set. Call your agent's firm and talk to the boss. Point out that while this is going on he is not making any money. Ask for a new agent.
I never closed on a cash deal in 2-3 weeks
In fact one took almost took 7 months.
I was buying a commercial property with acreage and about to close and I get a call from my attorney, hey, the sellers want you to sign a disclosure that they have no knowledge of toxic chemicals buried on the property......
We ended up doing an environmental/dumping investigation, at the sellers expense. Hired a company called Industrial Waste Mitigation or something like that, actually there were a lot of these type companies in New Jersey. No traces of anything, it was expensive to do.
Ended up closing, the idiot seller was like, hey, why did this take so long to close..... Freakin idiot
I have dug holes on the property with my backhoe and so far haven’t hit any steel drums or found Jimmy Hoffa... It’s a Jersey thing
*** “This is not a good time to sell a property” ***
I’m thinking a couple weeks from now might be Really Great or Really Bad.
I am going back to work... permission or not
Between me and my sister, we have closed 8 properties in the last 2 years with cash, all in about 15 days, one took a little longer because the seller wanted $30k earnest money on a 280k property and we held firm at 5k. One was a finance deal with 25% down that took 28 days but the buyers could have paid cash.
This was in Florida and the banks and title companies know us, so maybe there's something to that too.
Your agent is slacking - you could have taken the second offer as a fall back if the first defaulted.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.