After working diligently to sell a property for a client, the deal fell apart. I know almost all of you can identify with this scenario. A very nice clean home listed for a very reasonable price - another agent brought a young couple to see the property. It was perfect - just what they wanted - they were pre-approved with a bank. When it was all said and done, they decided to go FHA - which brought some additional costs to my seller - paying points etc. After considerable repair costs, we find out the buyer went from a full time job to a part time job several weeks ago, but neglected to tell his real estate agent or title company and the day before closing we hear they can't get financing. My seller is reluctant to return the deposit as he feels the buyers were less than honest in providing financial information. Of course the funds must be returned prior to accepting another offer, but the entire process is very frustrating. I know I am not alone in this situation.
Hi there,
Oh boy, you're right about not being alone in the situation.
I'd assume you contract has some sort of clause about "acting in good faith", correct? I think I'd be speaking with your broker on this one.
Regran - I think so many buyer's don't think this is a big deal when in fact it is. The same usually holds true for buyer's who make big purchases while under contract, most don't think about it.
It is a tough situation and I don't know that I know the answer. I definitely understand where the seller is coming from, but it is hard to know if something was intentional or not. Sorry you had to witness a situation like this personally. Much success to you...
Too bad their agent didn't instruct them not to make any changes in their life until after closing.
I always ask for an additional escrow deposit to cover the repairs and have the repairs paid for out of escrow.
I'm sure if it was a loss of a full time job it was just as devastating to the person wanting to buy the home. Them changing their loan to FHA was most likely at the suggestion for their lender -- they do that to my buyer clients all the time. Your clients made "costly" repairs . . . they'd probably have to make them with the new buyers if they want to go FHA, so those things are done now and out of the way for the next offer. Should be smooth sailing then.
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