Sold Home "as Is" For Dicount
Hey guys,
Just sold my home as is for a $25,000 discount. I advertised for sale by owner for $315k, 3bed/1bath, 4 car garage, victorian. No agents invloved in this transaction. So I get an interested buyer who says "I like it and I noticed it will need a new roof and the foundation is sitting on brick with some concern". "Will you discount it if I purchase it "as is" and dont worry about any reports. I said sure! .... Well two weeks later... she says "My husband is saying that depending on how extensive the work to be done to the foundation and the termite report and the home inspectors report if its to much money to correct all these problems we might not sign at closing". I'm like...huh? I just thought we made a cotract deal to sell it "as is" due to the noticable work to be done and this is why we discounted it. Can she string me along like this?? help? does any one know the California purchase agreemant contract "in and out" enough to point out to me where she can get out of this one or where I can gain a strong point and bring to her attention that this is a 'breach on her part due to accepting it "as is".
John :-(
John,
This sounds like a legal question. Maybe someone on this site can give you an answer but it sounds like you should also consult a real estate attorney if you are really concerned.
I am not advocating jumping right into litigation but the lawyers advice might help you decide which avenue to pursue, i.e. negotiations, compromise, court etc.
Charley
brainstorm,
I'm not an attorney and an attorney should be the one giving you legal advice.
The key question, as I see it is: did the purchase contract, signed by you and the buyers, state that the buyers were purchasing your property in its as-is condition with no inspection or other contingencies?
Nancy
Quote:
On 2004-06-30 02:14, brainstorm wrote:
Hey guys,
Just sold my home as is for a $25,000 discount. I advertised for sale by owner for $315k, 3bed/1bath, 4 car garage, victorian. No agents invloved in this transaction. So I get an interested buyer who says "I like it and I noticed it will need a new roof and the foundation is sitting on brick with some concern". "Will you discount it if I purchase it "as is" and dont worry about any reports. I said sure! .... Well two weeks later... she says "My husband is saying that depending on how extensive the work to be done to the foundation and the termite report and the home inspectors report if its to much money to correct all these problems we might not sign at closing". I'm like...huh? I just thought we made a cotract deal to sell it "as is" due to the noticable work to be done and this is why we discounted it. Can she string me along like this?? help? does any one know the California purchase agreemant contract "in and out" enough to point out to me where she can get out of this one or where I can gain a strong point and bring to her attention that this is a 'breach on her part due to accepting it "as is".
John :-(
*It will depend largely on what it says in your contract regarding contingencies and the as is caluse. Since no one can read you contract, its best to talk to an attorney about all of this.
May I ask why you would accept a discount on your property and not be willing to pay a brokerage fee to help you with the sale? The money you think you are saving could keep you out of the court systems. Besides its the buyer that pays the fee, not you.
Nancy, Charlie, Madam,
Thank you for the response, I will call an attorney and have him revise my contract.
As for Madam... I see your point for not using a broker can bite you in the end, well this is or was my thinking...I could save the 4% to 6% commission (315k x 4%= 12k!) but I see now in this situation I would of had the peace of mind of knowing my deal would close with good representation. If it falls through...I will get a broker. Thank you.
Quote:
On 2004-07-01 01:20, brainstorm wrote:
Nancy, Charlie, Madam,
Thank you for the response, I will call an attorney and have him revise my contract.
As for Madam... I see your point for not using a broker can bite you in the end, well this is or was my thinking...I could save the 4% to 6% commission (315k x 4%= 12k!) but I see now in this situation I would of had the peace of mind of knowing my deal would close with good representation. If it falls through...I will get a broker. Thank you.
*Good idea and Good Luck!
Sorry to be a little late weighing in here but I'd treat this a little differently. My guess is that the "buyer" is setting the stage to get you to take another discount at th closing table. I'd short-circut that process very quickly. I'd send the buyer a letter reviewing "as is" discount. I'd review the phone conversation where the buyer is clearly doing a "due dilligence" review in contrast to the "as is" agreement in the contract.
"It would appear in light of these circumstances that there has been some failure to come to a meeting of the minds. I am, therefore, releasing you from your obligations to close under the contract and am prepared to return your earnest money. Enclosed you will find the appropriate release, Please sign and return it for full refund of the Earnest money deposit."
My guess is that they will fold and close "as is" but if not you've got your house back and you are at square one now rather than 30 to 60 days from now when you are at the closing table getting beat up for another $10,000 discount.
Read the contract. What does it say about damages if the contract is not completed? You may be entitled to keep the deposit.
Please get legal advice.
Is there any contract clauses that will let the buyer get out of it such as approval of a inspection report?
There is no "California" purchase agreement. Where did you get the contract that you both signed? Please read it carefully.
BOB FORD
**Please See My Profile**
Excellent advice from the commercial king. I have sold only once through a realtor and ahve never had any problems. Having taken the RE brokers tests etc. etc. etc. I cannot see how a broker would save you from litigation. A simple earnest money agreement with the appropriate clauses would be more valuable especially if you have a buyer. 6% X 300+K is $18,000 in commission. That comes out of you the sellers pocket not the buyers. $1000 will get you one heck of a contract and some great legal advice with most left over for your next deal
Under Oregon law an agent cannot help you make up or choose a contract, only fill out the blanks. They are to advise you to seek the services of an attorney if there are any questions. Agents who represent otherwise are stepping outside the bounds of their legal authority and the law.
I think agents are great but mainly handholders for the uninitiated, or when the market is tough and you can't get the needed exposure. Everyone has their niche. On a property in Oregon city worth 600K do I need an agent to sell in a hot area off a private lake? I generally had to educate my agents (when buying) on the creative side of RE. That is when I decided to get my license and collect a percentage of the commission on the houses I buy and sell...
Good Luck!
[addsig]
Quote:
May I ask why you would accept a discount on your property and not be willing to pay a brokerage fee to help you with the sale? The money you think you are saving could keep you out of the court systems. Besides its the buyer that pays the fee, not you.
Because an REA isn't going to be any more effective in preventing litigation whatsoever. The agents I have dealt with got me into litigation. Had I done it myself, I had a better chance of avoiding any litigation.
Just my opinion, but there are a lot of deals I'd rather sell at a discount, sell faster and not deal with an agent.
Robert
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Robertt,commercialking,bradford, and gang,
thanks guys. I see that most of you have encouraged to continue buying or selling trying not to use an agent. I think one) I have set my self up for the buyers to bring me back to the table and ask for another discount...thats not going to happen. As for the agents service I know thats a lot of money and I see during dry times its nice to use their service but I get "blackballed" in my little town where all the agents know each other and they discourage fisbos and rather not bring a buyer to me, even if I am willing to coop. I don't get it... they want to get the listing or nothing. I would rather make 1% of a thousand transactions rather than 6% of twenty. At least thats my thinking.
So was the thinking of John Paul Getty, the richest man in the world in his day.
[addsig]
BRAINSTROM (original poster)
Small world ... I was born, raised & lived in Woodland for 39 years.
I have been a real estate broker for 14 years in CALIFORNIA.
Some of the poster's help have been from out-of-state people offering advise which California does vary from other states. In California, attornies are usually not part of the normal selling & buyer ... only when law suits are involved.
Since you are (or were) selling "For Sale By Owner" (and that can be ok) but what "purchase contract" DID you use? Hopefully, the pre-printed California Association of Realtor (CAR) form?!
That is the first and major question. Because you are asking us about what the contract states to protect you from your buyers.
Buyer should have a limited "time period" to perform the inspections, investigations of the property, loan prequal, requests repairs, etc.
Cheryl Lopez, Broker
[ Edited by cheryllopez on Date 07/03/2004 ]
Hey,
When I first read this post and then Madame's response, it raised an eyebrow. But I thought it better not to question it, as maybe it was not a thinly veiled plug for RE agents/brokers. Over the weekend (as I was painting the inside of a house), I got to thinking about it and I came back to make a comment. Surprise, surprise...some other people thought the same way as I did.
Anyway...
RE Agents can do somethings to help investors/sellers, but they are not there to:
1) Help with contracts. ( I can create or have a lawyer create a much, much, much stronger seller's contract than any RE agent is going to provide, because they are going to use the standard.)
2) Provide legal advice. (Anything outside the normal contract and you are going to get into some grey areas and the RE Agent is not trained to handle. That is not an insult, a surgeon is not trained for this either.)
3) Get a higher price for your house. ( If you has house is in good condition, has a good "curb appeal" and you are willing to put in the effort, you can get a good price for your house. In fact, if you split the cost of commission with the buyer, both parties win.)
In all honesty, RE agents provide one service that results in one BIG benefit: they have a huge source of QUALIFIED retail buyers, which means you sell a house faster. And that is about it.
Now that does have value, but let us be real as to what they can do.
EVERYONE --
To help "For Sale By Owners":
Because most problems come up with poorly written contracts on "For Sale By Owner" ...
Usually the local board of realtors will sell the contract forms to the public. The price is higher than what agents pay.
But using a pre-printed contract that was prepared by attornies and review by working real estate professionals is a better way to go than your "self" prepared contract.
Cheryl Lopez
EVERYONE --
To help "For Sale By Owners":
Because most problems come up with poorly written contracts on "For Sale By Owner" ...
Usually the local board of realtors will sell the contract forms to the public. The price is higher than what agents pay.
But using a pre-printed contract that was prepared by attornies and review by working real estate professionals is a better way to go than your "self" prepared contract.
Cheryl Lopez
Like Nancy said, it all depends on the contract you signed. Did you have them sign the Liquidated Damages Clause?
You might be able to at least keep their deposit.
Best Riches,
Jeff Adam
[addsig]
I have some of the same issues-selling a home "as is". The buyer says "no lender wants to take on the loan because of selling the house as is-they want it fixed before they will lend". I believe this to be pure hog wash. This is my deceased father's home and my sister and I decided not to do anything to it -just sell it. The buyer also says that now its all at the underwriters stage and the lender is B of A. I'm wondering if there is anyway legally to find out exactly whats going on with the buyers loan. Our lawyer is also her lawyer. :-?
[addsig]
BITESU2 --
Yes ... any underwriter process is confusing and takes a few days or weeks. That is the process. And especially with B of A !!
Give it some time. Your purchase contract should have some "time periods" that a buyer is required to follow. Re-read the contract.
If underwriter approval does not happen within the time period ... then respond to the buyer in writing that since the buyer can not ge a loan to purchase the property you are cancelling the escrow.
That is ... if you do want to cancel with this buyer or re-negiotate OR find another buyer.
There are plenty of other buyers out there. Since both of you have the same attorney ,,, hopefully you will receive the proper advise and not be swayed to continue on and give in on price or terms with the buyer.
Cheryl Lopez[ Edited by cheryllopez on Date 07/09/2004 ]