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January 3, 2008
Closing in four days--Seller still showing apartment
I recently signed a contract for a Cobble Hill co-op unit. We are scheduled to close on Tuesday of next week. I just found out that even though we're scheduled to close in 4 days, the seller has still not signed the contract (the "executed contract"). I was told that the seller will be signing the contract on Monday, the day before closing. I also just learned that the seller is having another open house this Sunday, just 2 days before we close.
I fully understand that a seller can and should continue to show his/her property until the buyer signs the contract, and for back-up offers, but in this case, I signed and returned the contract a while ago, and we're supposed to be closing in a few days. Is this standard? Thank you.
Comments
Oh, and to clarify, I've already been approved by co-op board, AND of course seller has my deposit.
Posted by: guest at January 3, 2008 9:15 PM
yeah alot of them do. not all.
Posted by: armchairwarrior at January 3, 2008 9:20 PM
I never heard of scheduling a closing before a contract is signed. Is this an all cash deal - If not I cant see how your bank would set-up a closing without a signed purchase contract.
Something fishy here???
Posted by: guest at January 3, 2008 9:20 PM
yeah, this is odd.
Posted by: guest at January 3, 2008 9:22 PM
OP here again, having trouble with sign-in. Yes, it is an all-cash deal. And I only just found out, two weeks AFTER we scheduled the closing, that sellers had not yet signed the contract, but "were going to do so" the day before our closing. And in the meantime, it seems, they've scheduled an open house.
Posted by: blt14 at January 3, 2008 9:24 PM
rescind your offer and the contract. It is not an open ended document for the seller...
I assure you in this market they will sign and return it the same day.
Also, I agree with 9:20, how do you have a closing without a signed conract?
Posted by: guest at January 3, 2008 9:31 PM
Houses under agreement are allowed to be shown for back up in case the signing falls through. The broker/owner can not however accept any offers and legally is required to tell all persons shown the house that it is currently under agreement.
Posted by: guest at January 3, 2008 9:31 PM
Sounds like your attorney is not at all on the ball, how do they not know that they dont have a signed contract until a few days before closing.
Posted by: guest at January 3, 2008 9:33 PM
I disagree 9:31 - It sounds like there is no agreement at all. If I walk in and offer 50K more on Saturday, what stops the seller from refusing to sign the conract on Monday and move forward with the new deal with me.
My understanding is that no signed contract (by both parties) means you essentially have nada, zero, zilch.
Posted by: guest at January 3, 2008 9:37 PM
Your story is so bizarre I'm almost speechless. I 90% don't believe you, but the 10% of me that does believe you is shocked that someone paying all-cash can be so naive. Get an attorney now. If you already have one, fire them and get another one.
If you really and truly have no signed contract, yet allowed a seller to cash your deposit check, then call up the seller right now -- better yet drive to his house -- and yell "WHY THE FUCK ARE YOU HAVING AN OPEN HOUSE AND WHERE THE FUCK IS MY SIGNED CONTRACT????"
Posted by: Emigre at January 3, 2008 9:54 PM
agree with emigre....do you even have a lawyer??? its clear that you have no idea how the process works. if you have a lawyer get a different one.
Posted by: guest at January 3, 2008 10:21 PM
Of course I have a lawyer. And my lawyer informed me today, very matter-of-factly, that the seller will be signing the contract on Monday. He did not indicate it was a problem. We are scheduled to close on Tuesday. I had assumed the seller had signed the contract earlier, and I never asked if they had since the closing date had been set. My check has not been cashed, but they have it along with my signature on the contract. And no, I don't know how exactly how the process works, which is why I am asking the forum.
Posted by: blt14 at January 3, 2008 10:31 PM
If you have no contract they can sell the house to someone else. Why would you schedule a closing with a signed contract. Your lawyer sounds like an idiot.
Posted by: guest at January 3, 2008 10:34 PM
the seller is playing games with you, attempting to have their cake (by having a ready and able buyer locked up) and eat it too (by continuing to show the house and seek better offers). this approach has no benefit to you whatsoever, and it has a lot of risk. you should threaten to back out of the deal unless the contract is signed tomorrow. ask your lawyer why you shouldn't make this threat; i'm curious to know his response.
Posted by: z at January 3, 2008 10:57 PM
p.s. keep in mind that your threat to walk away may be viewed by the seller as a real threat (and therefore motivation to sign the damned contract). an all-cash deal and fast closing isn't something most sellers will want to risk losing.
Posted by: z at January 3, 2008 10:59 PM
The seller sounds like his ass is dancing at 2 weddings.
Nothing is valid until the seller signs the contract
.Sleazy behavior.
Posted by: Ysabelle at January 3, 2008 11:04 PM
Ps.
Where is your real estate lawyer?
Now is is not the time for him to be taking a nap.
He is supposed to be helping you.
Posted by: Ysabelle at January 3, 2008 11:13 PM
If the seller hasn't cashed your check OR signed the contract, then he hasn't accepted your offer. You are screwed. Your attorney should be disbarred if he thinks this is normal.
By the way, what is the basis for your conclusion that the closing is scheduled for Tuesday? It better be something more than that is the date typed-in on your unsigned contract.
Posted by: Emigre at January 3, 2008 11:57 PM
I hope your money is held in an escrow account.
If your deposit is held in a personal account it is considered co-mingling and that is illegal.
Please read the back of your check carefully.
Posted by: Ysabelle at January 4, 2008 12:44 AM
You need to get this signed contract as soon as possible. At first I thought he had your deposit. but it sounds like he only has a paper check, which is virtually nothing. you are no different than those folks coming to the place for the open house.
You probably have the worst RE attorney in all of NY.
There is nothing matter of fact about this at all.
you should definitely get another atty. he will definitely miss something during the closing.
Good Luck.
Posted by: guest at January 4, 2008 12:49 AM
The date of a closing can be changed as long as all parties agree.
Posted by: Ysabelle at January 4, 2008 12:49 AM
Sorry, but I cannot believe you are that stupid. Do you realize why the seller is supposed to sign the contract Monday? It is so he can show it to prospective buyers on Sunday! To see if he can get a better offer. You are not the only one with all cash. You should forward this post to the bar association along with your attorneys information. Players as follows;
PROSPECTIVE BUYER-CLUELESS
CURRENT OWNER -SLEAZEBALL
BUYERS ATTORNEY -WORKING FOR SELLER?
Posted by: guest at January 4, 2008 1:47 AM
The whole thing seems weird. In addition to what everyone else said, if you don't get a signed contract til Monday and you close on Tuesday, when do you get your 48-hour walk-through? At the open house? Half an hour before closing?
Posted by: slopefarm at January 4, 2008 7:53 AM
First off, I'd just like to thank Ysabelle for my new favorite saying, "his ass is dancing at 2 weddings". That's priceless!
So, let me get this straight. Both attorneys and the title company agreed to a closing date without a signed contract? I've never heard of such a thing. I suppose there's something to be said for having a mortgage because this would never happen if a bank was involved. Is there a realtor involved? I would either call another attorney to get his/her opinion and/or call the seller's attorney to confirm the closing date. And call the title company too! Hopefully, you have some kind of paperwork so you can find these numbers.
Posted by: rh at January 4, 2008 8:24 AM
Call your attorney this morning and demand that you have a signed contract by 11AM or you're out. If the seller hasn't deposited your check or signed the contract, you have no deal and no legal leg to stand on if the seller bails on Monday. Never 'assume' the seller signed anything; you should have had a signed copy of the contract LONG ago.
Whether or not you have a contract, fire your attorney at 11:01 AM. He is taking you for a ride. Whatever you've paid for legal advice, you're not getting it. Did the attorney even do a title search?
Posted by: zeebee_in_bklyn at January 4, 2008 8:27 AM
I think everyone is being a little bit harsh on the original poster. Lets give him a break. We all know how stressful buying and selling can be and we aren't all experts.
But everyone is essentially correct - without a signed contract you have agreement from the seller no matter what he is saying. If you are getting some amazing deal on this place that you think someone else will snatch up in 24 hours and all cash, then you are in trouble. Otherwise, he will likely not find a buyer in the timeframe and you will get the place anyway.
But its totally sleazy of the seller to be saying one thing and doing another. Be extra suspicious of him/her and make sure your contract covers exactly what you paid for.
Most importantly your lawyer seems to be asleep at the wheel. He should be advising you rather than us - that is what you are paying for!
Posted by: Mrs. Limestone at January 4, 2008 8:40 AM
Please tell us you didnt use an attorney recommended by the seller - right? Or worse, you are not using the same attorney as the seller?
Posted by: guest at January 4, 2008 8:47 AM
Meant to write: without a signed contract you have NO agreement from the seller.
Posted by: Mrs. Limestone at January 4, 2008 8:59 AM
Why not go to the open house? Better yet, send your lawyer.
Posted by: guest at January 4, 2008 9:19 AM
I am equally perplexed as most commenters. I just can't imagine a closing even being scheduled before a contract is signed by both parties. It just seems illogical and bizarre. When I bought my apt (granted I did have a mortgage) my attny and the seller's attny couldn't even move forward without a signed contract. That's just the bottom line.
Posted by: guest at January 4, 2008 10:00 AM
To zeebee in bklyn.
I think the title search is done by the title compay and then the buyers lawyer goes over it, carefully.
In addition to getting title insurance to secure clarity for the buyer.
I hope i am right.
I don't want to mislead anybody at a crucial time.
The bad part is buyer will have to tip the title guy at closing which is insane due to the nightmare that is going on for the buyer.
The title guy make a big fat amount of money.
Why the obligatory tip?
Posted by: Ysabelle at January 4, 2008 11:24 AM
Ysabelle, I just closed a few months ago, I will say that of the 7 or so people at closing, the title guy was the only one that really did anything. In fact he was zipping through paperwork, instructing everyone, recording everything etc...The guy was pratically breaking a sweat for the whole 2 or so hours we were there.
As far as how much he earns, I couldnt tell you, but we really didnt mind the $150 or so tip that was obligatory and appreciated his hard and accurate work.
Posted by: guest at January 4, 2008 11:47 AM
For all you broker bashers this is why you need a broker on your side. A broker would never let this happen.
Posted by: guest at January 4, 2008 11:52 AM
11:52 -- But if you are a buyer in Brooklyn, the broker is not on your side, period. Even if we did have buyer's brokers, as a simple matter of economic incentive, the broker is going to be loyal to the deal. A buyer's broker would have no incentive to take or suggest actions that a client buyer might take to protect the buyer's rights that might put the closing -- and hence, the fee -- at risk. That is why everyone above is right to focus on the need for your own, trustworthy, competent attorney with no ties to anyone else on the deal, and who, of course, is not the attorney recommended by the seller's broker.
Posted by: slopefarm at January 4, 2008 11:59 AM
Who is the lawyer as so no one uses them in the future? Also, they are trying to get a higher price. As an all cash deal, did you offer less than ask? Since co-op boards like all cash deals, they are more likely to approve the purchaser. This makes it easier on the seller and thus they would be more likely to take a lower price.
Posted by: guest at January 4, 2008 12:05 PM
Hi Ysabelle, to clarify re the title search: I know the attorney does not do it himself but the buyer's attorney does have to order it from the title company. If this guy is stupid enough to assure his client that a closing is set without a signed contract in hand, I'll bet he was too lazy or incompetent to even order the title search.
Our title guy busted his butt at closing, especially when there were complications due to a truly inept seller's attorney. We tipped and have no regrets. Just my experience, though; I know a lot of people have hot opinions about the tipping thang.
Back on track: BLT14, any updates?
Posted by: zeebee_in_bklyn at January 4, 2008 12:20 PM
Why would a co-op approve you with no contract? What kind of building is this? Why would they waste any of their time if there is no contract signed. Sounds very bizarre.
Posted by: guest at January 4, 2008 12:29 PM
What co-op board would approve someone without seeing a signed contract? This is a troll, folks, ignore.
Posted by: guest at January 4, 2008 12:33 PM
Hey folks. Don't confuse this guy any more than he already is.
Last time I did one (a few months ago), there was no title guy at a co-op closing because there's no title insurance. That's only for condos. For a co-op, a simple search is run to make sure there are no claims on the shares attributable to the co-op unit being sold. REmember, co-op sales are transfers of shares in the co-op corp., not sales of real property.
Posted by: Emigre at January 4, 2008 12:35 PM
Thanks for all the replies. I don't want to get into more detail because I know sellers read this site. I am waiting to hear from my lawyer.
Posted by: blt14 at January 4, 2008 12:58 PM
I agree with those saying in Brooklyn real estate, everyone is working for the seller. That was our experience too. Even the buyer's people are working for the seller, because everyone makes their money only if the deal goes through. So literally your only leverage at all as a buyer is to give deadlines and threaten to back out. If you are the only offer there's no reason you can't do that. Only when there are multiple offers do sellers have less ability to threaten to walk away. But one offer? Forget it, you're the one with the power.
Did you do your inspection? I didn't see it mentioned. Make sure you do an inspection. It's not just for houses. Have the inspector tell you if he sees any major repairs in the co-op's near future, because you will be helping pay for it. Like if he thinks the boiler will need to be replaced for the whole building within the next few years, or new roof, things like that.
Posted by: guest at January 4, 2008 2:26 PM
Actually, if you use a family lawyer, you don't have to worry about your lawyer wanting the deal to go through in order to get paid. On the other hand, you have to put up with dealing with a family member.
Posted by: guest at January 4, 2008 4:14 PM
So, lawyer assures me everything is fine and that closing will proceed as scheduled. Says walk through can be morning of closing or night before. Attributes contract not being signed to holiday delays, sellers were away, etc. Speculates open house is more about broker keeping name out there more than anything else??? I wasn't worried before because this lawyer came highly recommended. But after reading all your posts I am worried. I'll have to see what happens next week. Thanks again for replies.
Posted by: blt14 at January 4, 2008 4:57 PM
I love it blt14, the broker gets to keep their name out there at your expense...The possibility is still open for an offer to come in that trumps yours, but highly unlikely since you are sitting with cash and ready to close.
Hopefully at worst this will be a great learning experience for you, and your deal will go off without a hitch.
Please do let us know how everything turns out for you next week. Judging by the exceptional response rate for your post, seems like alot of people are concerned and pulling for you.
Cheers!
Posted by: newsouthsloper at January 4, 2008 5:33 PM
Sorry, but your lawyer is a smuck, he shouldn't have allowed it to get to this. I don't blame you.
Nevertheless, I hope things do work out for you.
Posted by: guest at January 4, 2008 6:52 PM
please report on what happens! hope it goes ok despite the weirdness.
Posted by: z at January 4, 2008 9:11 PM
OP, a "walk through" is not the same as an inspection.
An inspection is done by a professional engineer BEFORE you go to contract. If your attorney did not insist on this step for you, your attorney is not performing standard due diligence. Bring an engineer with you on the walk-through. It costs about $500 and is worth every penny. Don't hire one that the attorney or broker recommends btw. Get your own. Look on Forum archives for recommendations of inspectors.
Posted by: guest at January 7, 2008 12:16 PM
my atty advised me not to have the walk-through on the same day as closing, as you will not have time to react if anything is wrong.
agree that co-ops do not even consider new purchasers without a contract. does this co-op have a board? have you been formally approved by it?
also, did your attorney do a lien search?
honestly, i would take your attys assurances with a grain of salt, and would call a second attorney for a reality check, as this is all very non-standard and i would be very concerned.
typically open houses cease only when the contract is signed. if you truly do not have a signed contract, then it is not surprising that they are still showing the apt.
Posted by: guest at January 7, 2008 1:37 PM
So, did you close or what? Status update please!
Posted by: guest at January 13, 2008 10:51 AM
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