When's a Real Estate Deal a Real Deal?
When does a real estate deal become a real deal?
At what point can a buyer rightly assume that they have entered into a secured transaction to buy?
- Is it when the offer is accepted?
- When a formal Contract is signed?
- The "Process" of its financing is in motion?
- Appointments for Inspections or Appraisals are made?
- Some other "step" in the Process?
Recently, a pre-approved buyer I was working with, made an offer to buy a home they had fallen in love with. After negotiation, they and the Seller(s) signed a formal Contract.
Within 2 days of the signing, an appointment for a Home Inspection (per the terms of the signed Contract) had already been made. My buyers felt they were on their way to becoming homeowners.
Over the following weekend, the Sellers hosted an Open House at the property involved in the signed Contract. They received another offer on the home. One with different buyers and "more favorable terms".
The Sellers canceled their Contract with my clients. They could do so as the Contract was still in the "Attorney Review Period" allowed by our local MLS Contract.
This Attorney Review Period stipulates: Attorneys (on both buyer and seller side) be allowed time to review, approve, disapprove, propose modifications (except for price), and propose changes to a signed Contract.
As the original Contract between my buyers and the Seller(s) did not include Closing Cost concessions or a Contingency Clause, the "more favorable terms" must have been one of the following:
- A Closing Date more beneficial to the Seller(s)
- The Waiving of an Inspection
- The Acceptance of an "As Is" offer, if Inspected
- Terms of Finance
- A Cash Offer
- Personal Property Inclusions
- Miscellaneous Favorable Terms to the Seller(s)
The Contract between my clients and the seller(s) was canceled immediately upon the Sellers receiving their other offer. My clients were not provided the chance to revisit or renegotiate the terms of their previously agreed-upon (and signed) Contract. I believe this explains why I could not get the Seller's Agent to respond tomy calls or communications regarding my clients.
What am I missing? I'm looking to learn ...
There was absolutely NO reason for the Sellers to believe that my clients could not Close successfully. Wouldn't it have been at least reasonable to offer a renegotiation opportunity to my clients?
My clients are now taking a time-out from buying. This experience has left them in a bit of shock. They'll jump back in, but it may be a while. Until that time, we'll continue to communicate.
But my initial question remains ... when is a real estate deal a real deal?
I'll put my 40 years of Mortgage experience and expertise hard to work on your behalf. I'm easily found at:
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