Contract fell through on first deal

8 Replies

Finally had found a deal on an off market property. The number worked, made offer, offer accepted, set to close August 10th. Here’s where things went downhill... When I made the offer, tenants were still in the house. As part of the contract, I stated tenants had to be gone (non issue), stainless steel appliances stay, yard debris needed to be cleared out (looked like Sanford and son...). Tenants moved out and destroyed the place. Not too big of a deal as I would be rehabbing anyway. But, they also took the appliances and busted up the deck with a baseball bat as they left. Seller refuses to replace appliances even though it’s in our contract and will not repair deck. In lieu of appliances and deck repair I said I would drop price to 59,500 (was $62k), their choice. They said no to both. Since I’m still within inspection period, all parties agree it’s best to terminate contract. I get the email document to withdraw this morning only to find my agent stated me backing out due to electrical box issue (there was no issue) instead of the truth. Advice? Do I leave it be? This sucks.

I don't know what your contracts say in TN but in MD I don't think they're allowed to just decide to ignore what was in your contract.

Paragraph 22 of our residential contract of sell says the following:

22. CONDITION OF PROPERTY AND POSSESSION: At settlement, Seller shall deliver possession of the Property and shall deliver the Property vacant, clear of trash and debris, broom clean and in substantially the same condition as existed on the Date of Contract Acceptance. Buyer reserves the right to inspect the Property within five (5) days prior to settlement. EXCEPT AS OTHERWISE SPECIFIED IN THIS CONTRACT, INCLUDING THIS PARAGRAPH, THE PROPERTY IS SOLD “AS IS.” The obligations of Seller as provided in this paragraph shall be in addition to any Disclosure and Disclaimer Statement as required by Section 10-702, Real Property Article, Annotated Code of Maryland and any provision of any inspection contingency addendum made a part of this Contract (See Property Inspections Notice).

That part that say the property will be delivered in substantially the same condition as existed on THE DATE OF CONTRACT ACCEPTANCE, was my saving grace about two months ago and should be the same for you. 

This is the very first sentence of our As - Is Addendum in MD 

The Property is sold in “AS IS” condition as of the Date of Contract Acceptance.

So regardless if you wrote the contract with a regular property inspection addendum or an As-Is addendum the property should be delivered in the same condition as it was at the time you wrote the contract. If that means there were appliances there at the time of contract acceptance and furthermore that those appliances are marked as part of your inclusions and your contract is largely the same as MD I wouldn't be signing any release. 

Your agent not telling you this/giving the wrong reason for the fall out just kind of seems like he/she doesn't feel like fighting this for you. 

Id suggest you are standing in your own way. A set of 4 appliances from Best Buy you can usually get for  less than $2k.  And just replace the damaged wood for about $4 a board.

@Traci Cameron Certainly there's some provision that if the house is not in the same condition as when you signed the contract, the contract can be voided? Imagine if the house burned down when you were under contract. You wouldn't expect the seller to be forced to rebuild it for you.

If the agreement stated appliances stay, and they are no longer there, then the seller is in breach and there is no deal.

Back out.  Not worth it...and do it fast.  The longer you wait, the more the seller thinks your emotions are entering the picture and that they can negotiate.

Possible future:

1 - You back out and move onto next deal

2 - Seller realizes you are serious, and makes the property right by the contract

3 - Seller "takes their ball and goes home",...then when the realize-

     a)  The property won't sell in its current condition at the same price
     b)  The seller will need to get (pay for) the property back to "sell-able condition"
     c)  The seller realizes you may be their best option still, and comes back to you to see if you are still interested...which you are NOT...at the same price as before (even if they fix it), or at a reduced price (if you have to fix it).  Remember, at this point, if this is what happens, YOU are in the drivers seat and have all the leverage.  Negotiate a better deal than the original one.

Originally posted by @Eric Adobo:

Are neighboring tenants  similar to the ones that know how to swing a bat?

Tenant quality matters. 

Sanford n Son live in D class neighborhood .Do you want to deal with that genre?

Like Tom Petty S song You Got Lucky. You got lucky.