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nhowardre · Dec 26, 2006, 02:01 PM

Escrow opened in early November with a 30 day escrow for the sale of our deceased fathers house. By DEcember 4th the appraisal and loan contingency was lifted by the buyers from the purchase contract. However, a couple of days before the close of escrow which was to be Dec 15th, the buyers asked for an extension until this Dec. 29th which we approved. The assistant that was helping told me they had to change to a different mortgage co. because the one they were using had some problems with social security numbers. Since my own husband and son had had problems we had to take care of with SS numbers I wasn't too concerned. However, today Dec. 26th we were faxed a cancelled escrow with the deposit of $1000.00 to be paid to us, the sellers, for payment from the buyers. Completely surprised, I called the buyers agent and he said it was because they are going through a divorce and not a problem with the loan. So I called the escrow co. and told them we wanted proof they were married as they had different last names on all their documents. My question is what are our options? We have to pay the pest inspection and repair contractor for about 7,300. Which included much needed repairs. We also live 300 miles away and had the whole house cleaned out of staging supplies etc and now we have to travel back up there and re-do the home again. Anyway that is besides the point. What are our options for being compensated or can we force them to comply?

Signed need to know.

Fr_Chuck · Dec 26, 2006, 02:48 PM

When they put in a offer to buy, they should have put down a payment, if and when they cancell this, you keep that payment.

Unless your contract to buy gives you rights to go back after the pest inspection I don't see any options.

Many offers to buy fall though for varoius reasons, that is why those with too many conditions are often not accepted by the seller,

Thins such as re staging, and the such are just part of your cost in selling the home, and you start over, since you already have a current pest inspection ( it should be good for a limited period for a new offer)

As for repair, most likely it needed to be done, and you got the benefit from that repair on the home.

Sorry but this is about what happens, even on your next buyer, the loan can fall though at the last moment. That is why those are written in as a condition.

And the lenders or buyers agent should not be giving you any confidential info as to why there were turned down, they can and should only tell you the loan was rejected.

LisaB4657 · Dec 26, 2006, 05:41 PM

It all depends on what was written in the contract. But the general rule is that, if the buyers default, and if the contract doesn't provide otherwise, then the seller must re-sell the house. If the house eventually sells for less than the price in the original contract, then the seller can sue the original buyers for the difference plus any costs incurred in re-selling.

In the meantime get the house back on the market as soon as possible. Once you get it sold I suggest that you speak to an attorney about the options available to you.

Fr_Chuck · Dec 26, 2006, 06:43 PM

I did not see where they had a loan approved, in fact you said that they had a loan not approved but asked for more time to get a 2nd loan, which did not appear to get approved?

Also was the extension done in writing ( or by electronic transmission which is not accepted as in writting)

I am just looking from there side, if you try and sue, they can merely show their loan denied and state they were never approved for another one. You would almost have to prove they were approved for a loan, esp after they were rejected for the first one.

And as states you may get to try and collect some difference in final sale price after you sell the house, but after hiring a lawyer, if this amount is not large, is it really worth it.

nhowardre · Dec 27, 2006, 01:42 PM

We are sending a demand to close escrow, because according to their agent they were getting a divorce and we do not feel this may be true. He was adamant that it was not because of lack of a loan. Yesterday we let the escrow company know we would not sign the cancellation agreement unless we had proof of divorce, for instance, marriage documents. Divorce filing papers. Our feeling is that they are just getting cold feet or decided they could get a better deal. So the demand to close CAR form DCE states that we can do 1 of several things. 1) Cancel the agreement if they do not perform, 2) bring legal action against them for damages not limited to the deposit or 3) bring legal action against them to force them to buy the Property because we have fully performed. We are in CALIF. And this is the form that is being sent to them. The demand to close escrow states they must close escrow within three days or those options can be pursued.

Nancy

excon · Dec 27, 2006, 01:58 PM

Hello n:

What you're doing is like trying to stick toothpast back in the tube. These people AREN'T going to buy your house. They are getting divorced, or they can't get a loan, or they found a better deal. It makes no difference. That's the way it happens in the real estate world.

How you protect yourself from that, is you get a LARGE earnest money deposit, along with the contract. Then, you couldn't care less if they defaulted. If the deposit was large enough, you HOPE they WILL default. But, you didn't do that.

Threatening somebody AFTER they've defaulted and trying to get money out of them is,, well, it's like trying to put toothpaste back in the tube. It ain't going to happen!

There's a MUCH easier way to accomplish this task. Next time, remember the phrase "earnest money".

excon

ScottGem · Dec 27, 2006, 01:58 PM

Hmm. I researched the DCE (Realty Times - Agent News and Advice). This form does not have the force of law, its simply a form provided by the California Association of Realtors (CAR) for this eventuality.

But, from what I know of real estate transactions, you cannot force the buyer to close on the home. You can only apply the penalties provided for in the contract for breach of contract. You can sue for compensation of additional expenses not covered by any deposits.

It doesn't matter why the buyers cancel the contract. They can do so for any reason they want. That's why penalties are provided for in such contracts. That's why deposits are paid.