Broke Seller Wants Out
Anyone have experience with a seller trying to get out of a sale at the tail end? We’re trying to schedule closing and the seller is trying to get out of it. They actually don’t have enough money to close, because they are in more of a financial pickle than we had any idea of….
Anyone have experience with a seller trying to get out of a sale at the tail end?
We’re trying to schedule closing and the seller is trying to get out of it. They actually don’t have enough money to close, because they are in more of a financial pickle than we had any idea of. (We had no idea there was any pickle.) They owe the bank approximately what we’re in contract for, which leaves nothing for transfer taxes and their real estate agent.
We’re loathe to walk away since that would mean eating what we’ve spent on lawyers and mortgage applications, not to mention lost time going back with inspectors and whatnot.
Any ideas? Our lawyer is great, but he’s basically saying that we can try to force them to perform per the contract but it will drag out, because they don’t have the money.
I see your point, slick, but it seems like squeezing blood out of a stone.
Obviously the buyers should have acknowledged their pickle much, much sooner. And the seller should obviously hold the contract over the heads of the buyers and make sure they don’t lose anything because of the buyers’ stupidity.
But a lawsuit takes a lot of energy and money, and I don’t see the value of it if they can’t afford to own the house. It seems impractical, and it also seems that it would just make matters worse.
But maybe there’s something here I don’t understand. I am way out of my area of expertise here. Does the seller lose anything that can’t be reimbursed?
there’s nothing wrong with letting the seller out if thats what the buyer chooses to do. However, what’s wrong with holding the seller to the letter of the contract if that’s what the buyer wants to do?
Maybe I am naive… isn’t it appropriate to think about the pickle the buyers are in?
What’s wrong with exlege’s idea to have the buyer reimburse the seller’s costs thus far and let them walk away?
“Ignore Mr/Mrs What’s comment: second lien has no application here and the seller’s finances would not have come to light in any material fashon on the title report unless they had lots of judgments against them. ”
ON THE PAYOFF LETTER ASSHOLE!!!!!!! You can get a pay off letter in 24 hours sometimes in hours!!!! Them do the math! Also where is the broker in all of this and yes you can do a second line if the bank and everyone AGREES on it! Just make the liens assignable!!! This happen to one of my own transactions dumbass lawyers asshat and everyone was happy!!!
The What
Someday this war is gonna end…
I think the seller should go to his/her mortgage holder and seek a small reduction. If this guy/girl is truly hard up for cash, they should want to get out of it as fast as possible in case he defaults.
A minor write off now would be much cheaper than a foreclosure later.
The level of advice on this post is frightening. Serpentor, you have clearly got yourself a problem. You can likely sue the seller for “specific performance”; forcing them to perform their end of the contract. If the seller does not pay their transfer taxes your lender (if you have one) will very likely refuse to close. I do also believe that you can be held responsible for the transfer taxes ultimately even though they are primarily the responsibility of the seller. The problem with specific performance is that you are tying yourself up in the overburdened court system where you might not get resolution for quite a while.
Your lawyer doesn’t want to deal with this because he/she doesn’t make a lot of money on this transaction and stands to waste even more time if you need to sue. Despite what many people think, attorneys generally do not make a lot of money on residential transactions. It is funny how many people will throw 30 or 50 grand at a broker but whine when their attorney asks for $1500.
The parties should convince the broker to take the transfer taxes out of his/her commission because otherwise there will be no sale. The seller walks away with nothing. Otherwise maybe you can get the seller to reimburse you for your expenses and find another home.
Ignore Mr/Mrs What’s comment: second lien has no application here and the seller’s finances would not have come to light in any material fashon on the title report unless they had lots of judgments against them. You need to have a sit down with your attorney and if they don’t provide a meaningful plan of action then you need to start consulting other attorneys in a hurry.
With the caveat that you should consult your lawyer (or a new one) and that you should not ultimately rely on this post or any on this site for legal advice, I agree largely with DIBS and superlawyer. If seller won’t close, get a suit filed quickly to get the lis pendens. (Ask your lawyer whether you need to declare time of the essence or take any other steps first — I don’t do RE law and I am fuzzy on some of the details.) Once the lis pendens is filed, the property won’t be going anywhere until you release it. They won’t have any incentive to shop it around to see if there is more money out there. The incentive will then be for seller to come up with the necessary dough to make the deal work — negotiating a reduction with the broker, digging deep or borrowing elsewhere, etc.
You may find later that your best and least costly option will be to walk away rather than litigate, but the initial leverage you gain from the lis pendens may help a shake things out in your favor and it will certainly maximize your leverage and keep your options open.
Just have the seller to give you a second lien. A good lawyer will know how to do this! I will not explain this any further, just ask you lawyer and BTW Why you Lawyer didn’t see this on the Tittle Report?
The What
Someday this war is gonna end..
lawsuit