Here is a scenario that I feel will become more commonplace as more forclosures hit the market: You have a first time buyer and the property they want to buy is a bank owned property that has been on the market long enough for the price to fall into a low enough price range for your buyer. The house is in disrepair. The bank makes the buyer sign an "As-is where-is" addendum that states that the bank who owns the property will not do repairs. The first time buyer qualifies for a loan, but does not have alot of extra cash outside of the closing amount to be able to repair the house should the appraiser come back with an order for repairs to be done prior to closing. To make matters even more complicated, the bank has a time limit for the buyer to close, with a perhaps a $50.00 dollar a day penalty for every day that goes by if the property does not close on time. Often, the bank will not provide the buyer's side with the completed signatures from the seller's side until more than halfway through the transaction.
Buyer's agent beware! Take a close look at that addendum to the sales contract that the bank made your buyers sign. It may also state that the transaction needs to be closed at a Title and Escrow of the sellers choice or the title report will not be paid for by the seller. It is our job as the buyer's agent to make sure all of these things are addressed, and that these types of surprises do not cause undue anxiety for either the client or ourselves! We certainly want to get that first time buyer to call us again when it is time to sell in a few years.
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