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The agent says the buyer can drag his feet for months waiting to decide what he wants to do about any claim on the earnest money but until he makes a move we can't sell the house and will lose thousands and thousands of dollars. A lawsuit is possible but we can't put the house back on the market during the lawsuit and we have to move.
I am sure the buyers real estate agent is not happy either because she is out her 3% and lost time and effort.
The agent says the buyer can drag his feet for months waiting to decide what he wants to do about any claim on the earnest money but until he makes a move we can't sell the house and will lose thousands and thousands of dollars. A lawsuit is possible but we can't put the house back on the market during the lawsuit and we have to move.
I am sure the buyers real estate agent is not happy either because she is out her 3% and lost time and effort.
I suspect this isn't completely accurate. It's unlikely that a buyer in breach can keep you from selling your house once they have decided not to buy it. They may be able to hold up the escrow claim, but I seriously doubt they can prevent you from marketing the house. Ask your attorney to explain all your options and the time they would require.
Apparently you are referring to the 'final walk through' (one day before closing) to verify that all contingencies established by the initial inspection, have been corrected. The buyer is in a difficult spot, if they then decide that all of the contingencies have been satisfactorily met, but, that they no longer want the house. IMO, the purpose of the 'earnest money' deposit is two fold: (1) To establish that the serious intent of the buyer, so the seller can remove the house from the market 30-45 days during the closing process, and (2) to compensate the seller for incurred expenses, in the event the buyer breaches the contract (without substantive cause).
IMO (not a lawyer!) the way you describe things seems clear-cut, and 'should' enable you to collect and retain the deposit ... PLUS immediately re-list your house for sale on the market. However, ... lawyers have an insidious way of twisting things to make the 'facts' favor whatever party they are representing. Thus, you need to get your advice from your own lawyer. At a bare minimum, it would seem that you should be able to re-list the house for sale, but, even that may be considered as 'limiting the extent of your actual damages.'
Yes, eventually we may get the earnest money maybe in 6-8 month but it would involve a judge telling the escrow company to give the money to us, which would involve a lawsuit which would not allow us to put the house back on the market intil the case is settled, or the buyer has to sign a document saying he is waiving all rights to the earnest money. Our agent tells us that the buyer could drag his feet for months and do nothing hoping we would just give up and he would eventually get his money back. In the mean time our house is stale and we can't do anything.
Quote:
Originally Posted by jghorton
Apparently you are referring to the 'final walk through' (one day before closing) to verify that all contingencies established by the initial inspection, have been corrected. The buyer is in a difficult spot, if they then decide that all of the contingencies have been satisfactorily met, but, that they no longer want the house. IMO, the purpose of the 'earnest money' deposit is two fold: (1) To establish that the serious intent of the buyer, so the seller can remove the house from the market 30-45 days during the closing process, and (2) to compensate the seller for incurred expenses, in the event the buyer breaches the contract (without substantive cause).
IMO (not a lawyer!) the way you describe things seems clear-cut, and 'should' enable you to collect and retain the deposit ... PLUS immediately re-list your house for sale on the market. However, ... lawyers have an insidious way of twisting things to make the 'facts' favor whatever party they are representing. Thus, you need to get your advice from your own lawyer. At a bare minimum, it would seem that you should be able to re-list the house for sale, but, even that may be considered as 'limiting the extent of your actual damages.'
Yes, eventually we may get the earnest money maybe in 6-8 month but it would involve a judge telling the escrow company to give the money to us, which would involve a lawsuit which would not allow us to put the house back on the market intil the case is settled, or the buyer has to sign a document saying he is waiving all rights to the earnest money. Our agent tells us that the buyer could drag his feet for months and do nothing hoping we would just give up and he would eventually get his money back. In the mean time our house is stale and we can't do anything.
As I've said, I don't believe that to be accurate. I find it VERY difficult to believe that someone who states they do not want to buy your house can prevent you selling it to someone else. They only thing that person has any claim on at all is the money in the escrow, not your house. I'm not an attorney, and I doubt your agent is either. Call your attorney and ask the question.
I suspect this isn't completely accurate. It's unlikely that a buyer in breach can keep you from selling your house once they have decided not to buy it. They may be able to hold up the escrow claim, but I seriously doubt they can prevent you from marketing the house. Ask your attorney to explain all your options and the time they would require.
Quote:
Originally Posted by snooper
Yes, eventually we may get the earnest money maybe in 6-8 month but it would involve a judge telling the escrow company to give the money to us, which would involve a lawsuit which would not allow us to put the house back on the market intil the case is settled, or the buyer has to sign a document saying he is waiving all rights to the earnest money. Our agent tells us that the buyer could drag his feet for months and do nothing hoping we would just give up and he would eventually get his money back. In the mean time our house is stale and we can't do anything.
I agree with Bill above and believe your agent is full of Crap. He's giving you legal advice and it's not good. It would be worth a few hundred $$ to get the $8k earnest money for your damages or to get the house sold.
I might even be tempted to file suit for "Specific Performance" at this late date.
A strongly worded letter from an attorney might motivate these Buyers.
I agree with Bill above and believe your agent is full of Crap. He's giving you legal advice and it's not good. It would be worth a few hundred $$ to get the $8k earnest money for your damages or to get the house sold.
I might even be tempted to file suit for "Specific Performance" at this late date.
A strongly worded letter from an attorney might motivate these Buyers.
Agree with Rakin. Collect the earnest money, plus damages which may include having to take a loss over and above the amount of earnest money in order to get the property sold; and any loss incurred to seller if he has damages on the purchase of another property, rent, moving expenses, etc. Throw the whole ball of wax at buyer in default.
I've seen (several times) a letter from an attorney just threating damages and performance motivate a buyer who gets cold feet. They are under contract and need to understand the damages if they do not perform to their agreement.
When I see a house go back on the market after saying contract fell through I always thought it was a real estate agents sales gimmick that tries to make a now stale house look fresh again. Buyers will still see the house as stale and now it likely worth 10% less.
Not at all the case in our local market, which remains stable and continues to move pretty briskly.
We put our house on the market right as the housing market crashed in 2008 and it sat there, with some showings but no offers, for about six months. We took it off the market during the holidays and put it right back on the market in January. It sold in ten days. No harm done and wow, we had to find a house FAST!
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