The new forums will be named Coin Return (based on the most recent vote)! You can check on the status and timeline of the transition to the new forums here.
The Guiding Principles and New Rules document is now in effect.
Whose at fault? Closing details on home purchase
Figgy
Fighter of the night manChampion of the sunRegistered User regular
Fighter of the night manChampion of the sunRegistered User regular
I just hooked up the electric for a home we purchased (closing on the 14th) and found out that the maintenance fees quoted in the listing were inaccurate.
The electric company informed me that electric, water, and sewage would be billed to us as of the 14th, while the listing says water and sewage are included in the $149.90/mo maintenance fee.
I called the condo corporation to confirm, and we are indeed responsible for these utilities. I then called our realtor who searched up and confirmed the listing said they were included and our signed offer quoted the maintenance fee and everything that was supposedly included. I also have a hard copy of the listing.
I called our lawyer, who told us to talk to our realtor first to get in touch with the seller's realtor.. find out if this can be settled quickly. My realtor talked to the seller's realtor, who was his usual coy, cocky self. He basically said, "Oh well, you guys lifted the status clause so, tough."
Now, we lifted the status clause based on the information that was provided to us: the maintenance fees included water, buidling insurance, and exteriror maintenance.
Right now, our realtor is speaking to our lawyer about escalating this to a lawyer to lawyer negotiations (between ours and the seller's).
So, whose fault is it?
I am thinking it is a combination of the seller/seller's realtor and our lawyer.
The seller or the realtor misrepresented the sale in the listing of the house, and when they accepted the offer they did not cross out or say anything about excluding the "water included in the maintenance fee" portion of our offer.
On the other hand, we did lift the status clause, saying everything checked out in that department. That, was on the go-ahead of our lawyer who was supposed to do a status search and make sure everything checked out over at the condo corporation.
Now, obviously we aren't expecting someone to pay our water/sewage bill now for the next 30 years, but we're looking for something to be done here. It's not right that the seller/realtor can misrepresent the property and shrug their shoulders when something turns out to be incorrect. We also don't necessarily want to walk away from the sale, since we've already invested money into the house (inspection/lawyer/etc.) and are basically less than two weeks away from moving in.
We've been more than reasonable with this seller, letting problems slide such as a couple cut holes in the basement carpet that he was covering up with an area rug (found during inspection), unsafe/improper placement of the laundry room in the finished basement, where the only outlet for the washer is the "test outlet," so that needs to be re-wired to its own breaker, a faulty exterior outlet in the back of the house, and other minor details. We let them slide because the seller is being somewhat of a prick about any little thing, saying he's broke and can't afford anything, so we can just walk if it's a problem.
Has anyone been a situation similar to this? What should I be saying to my lawyer/realtor when we speak next? I have a feeling they're going to say, "The seller is prepared to let you walk if it's a problem." By now, isn't it too late to just throw that out there? Can you hide little things like this in a sale and just laugh when it's found too late?
The electric company informed me that electric, water, and sewage would be billed to us as of the 14th, while the listing says water and sewage are included in the $149.90/mo maintenance fee.
I called the condo corporation to confirm, and we are indeed responsible for these utilities. I then called our realtor who searched up and confirmed the listing said they were included and our signed offer quoted the maintenance fee and everything that was supposedly included. I also have a hard copy of the listing.
I called our lawyer, who told us to talk to our realtor first to get in touch with the seller's realtor.. find out if this can be settled quickly. My realtor talked to the seller's realtor, who was his usual coy, cocky self. He basically said, "Oh well, you guys lifted the status clause so, tough."
Now, we lifted the status clause based on the information that was provided to us: the maintenance fees included water, buidling insurance, and exteriror maintenance.
Right now, our realtor is speaking to our lawyer about escalating this to a lawyer to lawyer negotiations (between ours and the seller's).
So, whose fault is it?
I am thinking it is a combination of the seller/seller's realtor and our lawyer.
The seller or the realtor misrepresented the sale in the listing of the house, and when they accepted the offer they did not cross out or say anything about excluding the "water included in the maintenance fee" portion of our offer.
On the other hand, we did lift the status clause, saying everything checked out in that department. That, was on the go-ahead of our lawyer who was supposed to do a status search and make sure everything checked out over at the condo corporation.
Now, obviously we aren't expecting someone to pay our water/sewage bill now for the next 30 years, but we're looking for something to be done here. It's not right that the seller/realtor can misrepresent the property and shrug their shoulders when something turns out to be incorrect. We also don't necessarily want to walk away from the sale, since we've already invested money into the house (inspection/lawyer/etc.) and are basically less than two weeks away from moving in.
We've been more than reasonable with this seller, letting problems slide such as a couple cut holes in the basement carpet that he was covering up with an area rug (found during inspection), unsafe/improper placement of the laundry room in the finished basement, where the only outlet for the washer is the "test outlet," so that needs to be re-wired to its own breaker, a faulty exterior outlet in the back of the house, and other minor details. We let them slide because the seller is being somewhat of a prick about any little thing, saying he's broke and can't afford anything, so we can just walk if it's a problem.
Has anyone been a situation similar to this? What should I be saying to my lawyer/realtor when we speak next? I have a feeling they're going to say, "The seller is prepared to let you walk if it's a problem." By now, isn't it too late to just throw that out there? Can you hide little things like this in a sale and just laugh when it's found too late?
Figgy on
0
Posts
also, if it comes down to it, sue his ass for fraud, because thats what it is. furthermore, having the inspection isn't a big cost when you consider then cost of homes. with how he has handled it, i would suggest you make them fix the carpet and rewire that laundry room or walk away from it, or make them deduct the cost from the final sale price. seriously, are you alright with paying that amount of money for something that isn't complete or was put together real shitty? you will probably have trouble with it in the future if you'r having trouble with it before you've even purchased it.
also, if the one you're having trouble with is the realtor, then you should take steps to get his license revoke for fraud. because to me, hiding defects of any sort to me is fraud. if its the property owner thats the problem, you probably really should walk away from it. i don't know the laws, but they can probably sell you a house with poo for insulation and if you don't find it before you close, you're gonna have a fight on your hands to get anything fixed.
also, i understand that you probably really want to purchase your own place, but do you really want one of the biggest purchases of your life to be something thats sub-par? it really sounds like you should cut your losses with this, unless you can get enough money off the top to cover all the work you'll have to get done once you move in.
The home is in fantastic shape and was rated above average for its age by the inspector, who came highly recommended and was fantastic. It's not "sub-par."
It's not a matter of me not wanting to walk away because I want to move into my own place. I'm in my own place now. It's a matter of it not making financial sense. Right now, we've invested x amount of dollars in an inspection, x amount of dollars in a lawyer, and money has been cashed out of various funds to go toward the downpayment. It would be very expensive (thousands of dollars) to walk away from this deal. The problem is, both the seller and his realtor know damn well that this is the case, and I believe they are taking advantage of this.
As for the "contract," the issue is that the signed offer (which is a contract signed by both parties) specifically mentions that the maintenance fees are X dollars and include A, B, C. If that is not met, we can walk away from the sale.
Before closing, all clauses must be met. We lifted the clause about the condo status (including what was mentioned above) after our lawyer did whatever it is they do (status search, etc.) because he said we were good to go--everything checked out. Well, he missed the part where he should have verified what the condo fees actually included. So, he dropped the ball on making sure that checked out.
Still, the seller/realtor misrepresented the sale of the home in the first place. I'm not sure if it matters that the clause was lifted, since the listing specifically outlines the condo fees and so does the offer... all along everyone understood that the listing was accurate--according to the seller's realtor, he thought that too.
It is likely this was simply a misunderstanding between the seller and his realtor when the listing was being put together. The problem is, it translates into hundreds of dollars a year for us.
but if you're that deep, i think you should have your lawyer look into it, and also contact the NAR or whatever organization that licenses realtors and report that this realtor misrepresented this deal. because under no circumstances is that ok, and it is grounds for having his license revoked. he might be a little easier to work with if this is the case. you have the listing on paper, as well as what you signed before the status clause was lifted. I'm pretty sure you're going to be SOL on the maintenance fees, but there should certainly be recourse for having this information misrepresented to you the whole way through this process. at the very least there are laws about Bait and Switch, which at the very lowest level sounds like what happened (even if inadvertently)
I don't fully understand what the status clause is, so it might make everything that precedes it null and void once it's lifted.
from my view, the fault lies with your lawyer/agent not catching that clause, as well as the seller/realtor not disclosing false information.
I'm hoping to hear from the lawyer tomorrow. I'm kind of hesitant really believing what he tells me at this point because he may be partially at fault and trying to steer me away from pursuing this.
if the former you might be able to hold them to the contract, if its a private party, you might be able to settle on some sort of recoupment but realisticly unless the market is really a buyers market its probably not worth fighting over since realisticly you won't walk away and they know it. if the no one is buying the threat of walking away is worth more than if he can just say ok, nice meeting you, get out of my house so the next guy can move in.
$150/month condo fee seems pretty normal. You could claim false advertising, but they will just say "your welcome to walk away from this", at most someone will get a light slap on the wrist and be told not to post misleading advertisements again.
You've got money in this deal already so you don't want it to fall through, but you gotta consider is it still a good deal, or are you going to walk on principal? There's no shame in either decision.
Can the contract be amended without having to go back and start over? Like maybe you could estimate 18 months of the service in question and amend the contract so you get that as cash back at closing. If the seller's truly broke, I think it should come out of the sellers agents commission. If they think you're really going to walk they might consider a deal like that, they might wait til just before expiration to see if you blink. When buying my house the sellers agent reduced his commission to 1% to get the deal done as he was pretty sure if it didn´t move it would be back on the rental market for up to a year (not saying the guy will in your case, but I'm assuming the lawyer's been paid and both agents get nothing if there's no deal). If you go this route your agent has to be convinced you´ll walk if they don´t play ball.
If you did leave the contract to expire so you could make another offer on the same property, couldn't you avoid repeating much of the expense? No need to re-inspect, and the paperwork should be the same, just changing a few numbers. If your lawyer's at all to blame I'd think he'd do the 2nd contract gratis (or steeply discounted).