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Message
Real Estate Baws - In here
Posted on 5/28/20 at 8:38 am
Posted on 5/28/20 at 8:38 am
I'm selling my old house and recently got a buyer under contract. The buyer first moved, then canceled the inspection last weekend, then on Tuesday we got word from the buyers realtor that they were unable to secure financing, so they wanted me to sign a release of escrow to get their deposit back.
I found this very curious because they buyer had pre approval from USAA, so when we inquired about the denial, their realtor told us that they tried to go with a local bank to get a better rate, and were denied.
My response was that I'm not signing shite until I see some documentation from the bank that they were denied financing. Personally I think they got cold feet or found a place they like better after signing the contract.
Furthermore, I believe I would be within my rights to push the issue and force them to go through USAA. The contract states that they must make a "good faith" effort to secure financing, and this seems like it would be the most basic good faith thing they could do.
The problem for me is that we're still under inspection period, so technically they can make up just about any reason under the sun and back out, but they haven't done it yet and I don't think their realtor is savvy enough to advise them to do this.
Inspection period ends Monday so I'm thinking if they don't make any kind of complaint about the house itself by that time, they're kind of screwed. They either have to at least try with USAA, or forfeit their deposit for wasting my time.
What say the real estate titans of the OT?
I found this very curious because they buyer had pre approval from USAA, so when we inquired about the denial, their realtor told us that they tried to go with a local bank to get a better rate, and were denied.
My response was that I'm not signing shite until I see some documentation from the bank that they were denied financing. Personally I think they got cold feet or found a place they like better after signing the contract.
Furthermore, I believe I would be within my rights to push the issue and force them to go through USAA. The contract states that they must make a "good faith" effort to secure financing, and this seems like it would be the most basic good faith thing they could do.
The problem for me is that we're still under inspection period, so technically they can make up just about any reason under the sun and back out, but they haven't done it yet and I don't think their realtor is savvy enough to advise them to do this.
Inspection period ends Monday so I'm thinking if they don't make any kind of complaint about the house itself by that time, they're kind of screwed. They either have to at least try with USAA, or forfeit their deposit for wasting my time.
What say the real estate titans of the OT?
15
Posted on 5/28/20 at 8:39 am to CptRusty
That's why there is a deposit. frick em
Posted on 5/28/20 at 8:39 am to CptRusty
Move on.
Posted on 5/28/20 at 8:39 am to CptRusty
Don't sign anything. You have the leverage to wait.
This post was edited on 5/28/20 at 8:41 am
Posted on 5/28/20 at 8:39 am to CptRusty
Seems reasonable to ask for proof. But how much are you willing to fight for the deposit? How much money we talking?
Posted on 5/28/20 at 8:39 am to CptRusty
Don't sign anything until you see a denied financing letter from the bank.
Posted on 5/28/20 at 8:41 am to CptRusty
Cool keep your house in escrow and have legal issues overhanging you instead of just moving on and finding a new buyer. You seem smart and logical.
Posted on 5/28/20 at 8:41 am to CptRusty
Send them this 
Posted on 5/28/20 at 8:43 am to Tshiz
quote:
Seems reasonable to ask for proof. But how much are you willing to fight for the deposit? How much money we talking
That's a good question. They've kept me under contract for 9 days now and the deposit is $2500. I'm willing to wait it out for another 5 days and then hit em with their severely diminished options to recoup some cost for wasting my time, but I'm not going to let this drag out until closing, which would be in July.
Basically I want this resolved by middle of next week. Any longer than that and it's not worth the money, but I think it's at least worth trying to grab at this point.
Posted on 5/28/20 at 8:45 am to stout
quote:
Cool keep your house in escrow and have legal issues overhanging you instead of just moving on and finding a new buyer. You seem smart and logical.
I can end this any time I want. They have already enabled one of my outs by not sending me proof of application of financing within 5 days of signing the contract.
Posted on 5/28/20 at 8:49 am to CptRusty
Move on then get a better realtor.
Posted on 5/28/20 at 8:51 am to The Torch
They can walk during the inspection period for any reason. Once passed that inspection end date, they can walk with a letter from any lender saying they could no get "acceptable" financing or were denied the loan. Either way they are going to get the deposit back. Pretty much the only way they lose the deposit is if they get a clear to close and then back out. Then you get the deposit & could sue for 20% of agreed upon sale price or have the judge force the sale. I would move on. What does your realtor say?
Posted on 5/28/20 at 8:52 am to CptRusty
Nope...
This is why you require a deposit, they potentially screwed up a secure sale from another buyer.
frick Em
This is why you require a deposit, they potentially screwed up a secure sale from another buyer.
frick Em
Posted on 5/28/20 at 8:57 am to Big Block Stingray
Wrong Stingray...not saying it is ethically right, but LREC rules/laws really favor the buyer with the deposits.
Posted on 5/28/20 at 9:00 am to Shoalwater Cat
quote:
Wrong Stingray...not saying it is ethically right, but LREC rules/laws really favor the buyer with the deposits.
If so, I stand corrected I'm not as well versed in Louisiana real estate.
In Texas you typically will have a provision for buyer to opt out without penalty if buyer cannot secure financing and at that it's a moot point.
This post was edited on 5/28/20 at 9:02 am
Posted on 5/28/20 at 9:01 am to CptRusty
If the pre-qual letter came from USAA, I would have them produce a letter from USAA stating why it is now being denied. They can't sign a contract and then back out for free.
Posted on 5/28/20 at 9:02 am to CptRusty
quote:Not a real estate agent, but every real estate transaction I was a part of that had financing involved had a clause in the purchase agreement that said something about sale being subject to buyer being able to secure financing at or below a certain interest rate. Does your contract have that clause? If so, is the rate they were getting from USAA at or below the rate specified in that clause of the purchase agreement?
I found this very curious because they buyer had pre approval from USAA, so when we inquired about the denial, their realtor told us that they tried to go with a local bank to get a better rate, and were denied.
But pre-approval doesn't really mean squat. They could've told USAA they make $80k a year to get a pre-approval letter but then when they had to produce documentation, they may have only shown $45k in actual income on taxes after everything they deducted for business expenses.
This post was edited on 5/28/20 at 9:03 am
Posted on 5/28/20 at 9:04 am to CptRusty
Lemme put on my dri fit and some gel in my hair and I can answer your questions
Posted on 5/28/20 at 9:05 am to Big Block Stingray
Give them their money back. I went through this same exact bullshite and was hell bent on keeping that bitches deposit as a matter of principle. I learned the hard way that the law in LA let’s the buyer get away with just about anything. It’s almost pointless to even have a contract and deposit.
Posted on 5/28/20 at 9:06 am to CptRusty
quote:
we're still under inspection period
Buyer will get their deposit back.
This post was edited on 5/28/20 at 9:07 am
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