Seller refusing asked for credits, offering repair credit instead.

Patricia Sander · 2023-02-16T23:34:30-08:00

Some rookie mistakes made here but I wanted a second opinion. I'm under contract and inspection showed up some issues with plumbing and the roof. I spoke with attorney and said basically I would just ask for a credit for roof replacement and got quotes sent it out. Seller comes back saying home is sold as is and a bunch of other nonsense how they disagree with my inspection because the roof "looks beautiful from the street" or whatever. Anyways I go to check everything realtor handed me (no seller disclosure was ever sent) and sure enough as is was not anywhere to be found on listing or otherwise. So I ask my attorney if I waived inspection contingency and she said no I didn't but yea the house is as is according to seller. I don't remember anyone mentioning this to me and I guess I should've read everything I signed but I assumed the attorney and realtor would have told me something like this, no? Well I tell my attorney I'm not satisfied with a repair on the roof as it's only kicking the can down to next year where I'll either have to make another repair on a 150 year old slate roof (2-5k) or cover the whole cost to replace myself. Other parts of the roof (lower) are newer shingles and in good condition, another rookie mistake was I didn't ask how old the roof was and just assumed about 10 or so years. Wasn't until my inspector was up with the drone that I noticed the other part of the roof is very old slate that's got cracks and other issues on it. While not leaking, it's at the end of its life and the owner was a real DIY landlord who thought 3 tab shingles would compliment a dilapidated slate roof perfectly. My EMD is due tomorrow (high EMD cash offer little over listing as I assumed home was in very good condition) and my attorney said we are negotiating but I don't wish to negotiate any repairs, I would rather walk and told my attorney I wish to terminate citing my inspection contingency and the issues that are in it. So I'm wondering if I have to legally send EMD and continue to negotiate with seller or if I can just terminate and not get into this whole headache with the seller trying to strong arm me into closing or try and grab the EMD by offering repairs in order to "satisfy" my inspection requests by repairing a few completely broken slates. My attorney said we can't just ask for a replacement and should work with seller if they want to offer repairs and I can't walk now that I made a demand to the seller… while I'm not an expert I've never heard of anything like this before? If I don't like the inspection and seller wishes to negotiate beyond what I want as resolution I'm within my right to terminate without negotiation so it feels like my attorney just wants to close the deal anyways despite my protests. What do you guys think?

Theresa HarrisPro Member

Member since 2019 · 15k+ posts · 11k+ votes

3y

Are you within the time period for the inspection clause? If so, you can say it didn't pass inspection and walk.

As for the 'as is', you can ask the seller for anything, but that doesn't mean the seller has to agree. They can stay firm on their price.

If you haven't put a deposit down on the house with your offer, then your offer isn't valid.

Where is your realtor in this? They should know how this works.

5 Reply

Adam Martin

Rental Property Investor · Member since 2020 · 1k+ posts · 1k+ votes

3y

As long as you didn’t waive the inspection and you are still in the inspection period you are free to walk. Home sales are a negotiation and you are free to try to get a better deal and it never hurts to ask however the seller is under no obligation to. Don’t force the deal and if the numbers don’t work with the roof then move onto the next one. I don’t know how you got as far as an inspection without putting down your emd but if you are walking there is no reason to put in down now.

2 Reply

Paul Pratt

Real Estate Agent · Member since 2023 · 91 posts · 80 votes

3y

@Patricia Sander I think you're overcomplicating things.

1. Almost all real estate transactions are AS IS.

2. Within your inspection period you do your due diligence, if you don't like it you can back out and take your EMD with you.

3. You can ask for a credit but seller doesn't have to give it to you. Someone else will probably buy it if it's a solid property.

4. Any attorney who is urging you to complete a deal you're not comfortable with is not a good sign.

10 Reply

Patricia Sander

OP

Member since 2023 · 5 posts · 2 votes

3y

Quote from @Theresa Harris:

Are you within the time period for the inspection clause? If so, you can say it didn't pass inspection and walk.

As for the 'as is', you can ask the seller for anything, but that doesn't mean the seller has to agree. They can stay firm on their price.

If you haven't put a deposit down on the house with your offer, then your offer isn't valid.

Where is your realtor in this? They should know how this works.

Yes my inspection contingency still stands, my realtor and attorney are offended that I don’t want to negotiate a repair on the roof so that’s where we’re at right now. I told my attorney and realtor that a repair is out of the question and if the seller doesn’t wish to lower price to account for roof replacement I am not interested in moving forward. Just because the roof isn’t actively leaking (honestly the condition is so bad I would be surprised that it isn’t but I can’t prove it as my inspection was done on a dry day and the attic is “finished”) I have already compromised on a lot of the issues that inspection revealed and refuse to compromise on this.

My lawyer telling me I need to hear the seller out and wait for their repair quote to come through is making me uneasy as the deposit they’re asking for while I wait is 50k. I don’t want to pay a bunch of legal fees to get 50k back out of this if seller and I can’t come to an agreement. I told attorney it’s replacing or nothing and she said repairs are just as good? I’m just not sure wtf is happening so I just flat out refused to send deposit and asked attorney to terminate based on inspection. I’m out inspection and some legal fees but I’m not about to be strong armed into this.

My offer is cash, above listing and what I asked for in terms of repairs still puts me cash above listing. The sellers had a bunch of low ball offers and a 5% down conventional about 10k higher than my offer…. The sellers own realtor said appraisal is not going to happen because they aimed high when listing. A similar home, 30 years newer with a new roof and more updated interior just sold for 5k more than what I’m offering AFTER inspection issues. I’m worried the seller is going to try and force this sale on me or drag this out when it comes to EMD. Can I really not request a full replacement and refuse anything else the seller offers? That doesn’t sound right to me just because seller is stating “as is” doesn’t negate my inspection contingency. Regardless I’m not putting up 50k with all this going on, if they agree to my credit I’ll have to suck it up and close I guess but I’m not negotiating anything and will stick to terminating contract due to inspection even if my attorney and realtor say that’s not negotiating in good faith.

0 Reply

Patricia Sander

OP

Member since 2023 · 5 posts · 2 votes

3y

Quote from @Paul Pratt:

@Patricia Sander I think you're overcomplicating things.

1. Almost all real estate transactions are AS IS.

2. Within your inspection period you do your due diligence, if you don't like it you can back out and take your EMD with you.

3. You can ask for a credit but seller doesn't have to give it to you. Someone else will probably buy it if it's a solid property.

4. Any attorney who is urging you to complete a deal you're not comfortable with is not a good sign.

You’re right, I told her I was terminating and she said I can’t do that, I asked what she meant as the contingency still stood and I was unhappy with seller response to “resolve” and she said I should at least hear the seller out first even if I wasn’t legally obligated to. I’m going to CC seller attorney and both realtors about my choice to terminate and never use this lawyer again as this is way more stressful than it would’ve been if I had adequate legal representation. Thank you for your input!

2 Reply

Theresa HarrisPro Member

Member since 2019 · 15k+ posts · 11k+ votes

3y

You can refuse anything, but you can also negotiate. If you thought the roof was 10 years old and they put a new 30 year roof on it-why not pay for 30% (or get a credit for 70%)?

From the seller's perspective if they got multiple offers, they are seeing themselves in a good position because if you don't want to take their offer, then they move onto the next person. If the roof is truly past its lifespan, then whoever they try to sell it to next who has to get financing will encounter the same problem.

3 Reply

Clint Galliano

Real Estate Agent · Houma, LA · Member since 2016 · 238 posts · 115 votes

3y

Depending on the laws of the state you are in is the first caveat. Your realtor probably has been or should be assisting your negotiations and advising you on the process and possible outcomes. I operate in Louisiana and our DDIP (Due Diligence & Inspection Period) ends as soon as we submit a Buyer Response to Property Inspection. But that only means that we can't do any other due diligence after submitting the initial response. We ask for repairs to be made by the seller, if indicated & supported by the licensed home inspector. The seller has no obligation to make said repairs but can respond with the following options: Make All Repairs, Make Some Repairs, Make No Repairs, or Offer Cash in Lieu of Repairs. Depending on how the sellers respond, the Buyer then has the option to accept the Seller's response and elect to proceed towards the act of sale or elect to NOT proceed towards the act of sale.

@Patricia Sander In your situation, this inspection is your opportunity to negotiate for what you want. Don't let any emotions you may feel cloud your judgement on this business investment. I am not familiar slate roofs, but from what you described, it sounds like a patchwork mess. Embrace the negotiation and stick up for what you want. Seller doesn't want to replace the roof with a quality roof installed by a licensed professional. Let the deal die and move on to the next one.

I would think that as a part of the purchase agreement, if you do not provide the EMD, the agreement becomes null & void anyway.

3 Reply

Mike Hasson

Specialist · Columbus, OH · Member since 2019 · 110 posts · 102 votes

3y

I had some roof issues as a seller. Not sure if it applies to your area or situation, but I was deciding how to proceed after a leak formed a few days before closing. I remember wanting to ask the buyer for more money if I was to replace the roof, which was old and in poor condition, riddled with patches. Those repairs had lasted several years btw. We knew it was old but hoping it would at least continue to function. It did not. And while I wanted to ask for more for the buyer to contribute to the replacement, since repair was no longer an option at that point. My listing agent explained to me that while an old roof may detract from the value, a new roof would not add value. An interesting distinction, as in my mind, it was the opposite.

Since the buyer did in fact pay over asking, and was very easy to work with through negotiations, I, after careful deliberation, bought the buyer a new roof.

It hurt my bottom line since I wasn't expecting it, but it was the right thing to do and saved the sale. And looking back, that roof while not cheap, was a just drop in the bucket in the big picture. Besides, as an investor, if I don't have enough cushion for things like this to come up and still be in the green, then it was probably too risky a project to begin with. Besides, in the end, I am glad to know that the leak occurred a week before, and not a week after closing. Since I look it this like a business, the buyer is my customer, and I want my customers to receive a quality product - and ultimately they did!

So I'm not sure how much of my experience translates to yours, but these things do happen and flexibility is important. That said, ultimately I went with the roofer's recommendation, which was that that roof was beyond repair and had to be replaced. So if I was in your shoes, I would wait for the roofer's evaluation. Yes, roofs are important and expensive and anxiety inducing, but unless I knew more about roofs that a professional roofer (which even as an inspector, I do not), then I would wait for their professional evaluation. And if I was the buyer, I would at least elect to choose my own roofer for that quote.

2 Reply

Bill B.

Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes

3y

If you haven't given the seller an EMD are you sure you're even "in contract"? As a seller I certainly wouldn't think you had the property locked down. But that may be a market difference as we also don't use lawyers and a $50k emd would be insane for anything under a few million.

As mentioned. You made an offer assuming an old roof. If the property had a new roof you would offered more, so asking the seller to pay 100% is out of line, especially if not actively leaking. You obviously would t be replacing the roof if you owned it.

If you don't like the deal and you don't have any EMD deposited I don't see how they stop you from walking and if that's your plan don't drag it out last some deadline. Just walk now and leave a "this is what I'd pay letter" with the seller's realtor. Meanwhile maybe you find yourself a better realtor, it sure sounds like you're doing their job for them.

1 Reply

Russell BrazilBusiness Member

Moderator

Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes

3y

If the contract calls for you to deposit an EMD, and you do not, you will be in default of the contract.

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0 Reply

Patricia Sander

OP

Member since 2023 · 5 posts · 2 votes

3y

Quote from @Russell Brazil:

If the contract calls for you to deposit an EMD, and you do not, you will be in default of the contract.

I already asked my attorney to terminate based on my inspection prior to contingency expiration.

0 Reply

Patricia Sander

OP

Member since 2023 · 5 posts · 2 votes

3y

Quote from @Bill B.:

If you haven't given the seller an EMD are you sure you're even "in contract"? As a seller I certainly wouldn't think you had the property locked down. But that may be a market difference as we also don't use lawyers and a $50k emd would be insane for anything under a few million.

As mentioned. You made an offer assuming an old roof. If the property had a new roof you would offered more, so asking the seller to pay 100% is out of line, especially if not actively leaking. You obviously would t be replacing the roof if you owned it.

If you don't like the deal and you don't have any EMD deposited I don't see how they stop you from walking and if that's your plan don't drag it out last some deadline. Just walk now and leave a "this is what I'd pay letter" with the seller's realtor. Meanwhile maybe you find yourself a better realtor, it sure sounds like you're doing their job for them.

I made an offer assuming a 10 year old roof not a 153 year old roof that’s completely done for. I expected some life on the roof not to have to do immediate replacements or repairs. I then told my attorney “if they don’t want to replace the roof then I walk” and the seller is saying I can’t walk. I’m literally terminating my contract prior to a contingency expiration within my right and for some reason seller and even my own attorney are trying to force me to close and accept whatever the seller wants to offer. I’m not sure how this got misinterpreted, I don’t want to hold the house up any further but I’m sure as hell not going to give them 50k of EMD when I made it very clear I’m not willing to negotiate and the seller has made it clear he’s not willing to give me what I want but expects me to negotiate anyways. This is just crazy, you can’t force a buyer to accept your own repairs after inspection rather than credit asked for.

0 Reply

Henry T.

Member since 2022 · 1k+ posts · 1k+ votes

3y

I've never heard of a deal started without EMD. Something weird here. If you've signed an agreement and kept your inspection clause, did an inspection, not happy with results of inspection, it's bye bye, you're done. Unless, you want to negotiate and work something out.

0 Reply

Paul Pratt

Real Estate Agent · Member since 2023 · 91 posts · 80 votes

3y

Quote from @Patricia Sander:

Quote from @Paul Pratt:

@Patricia Sander I think you're overcomplicating things.

1. Almost all real estate transactions are AS IS.

2. Within your inspection period you do your due diligence, if you don't like it you can back out and take your EMD with you.

3. You can ask for a credit but seller doesn't have to give it to you. Someone else will probably buy it if it's a solid property.

4. Any attorney who is urging you to complete a deal you're not comfortable with is not a good sign.

You’re right, I told her I was terminating and she said I can’t do that, I asked what she meant as the contingency still stood and I was unhappy with seller response to “resolve” and she said I should at least hear the seller out first even if I wasn’t legally obligated to. I’m going to CC seller attorney and both realtors about my choice to terminate and never use this lawyer again as this is way more stressful than it would’ve been if I had adequate legal representation. Thank you for your input!

No problem! Yeah, if your representative wants the house more than you do sounds like a red flag. Clients come first.

0 Reply

Joseph BeilkeBusiness Member

Real Estate Agent · Palm Coast, FL · Member since 2018 · 364 posts · 244 votes

3y

@Patricia Sander

Kudos to you for trusting your gut. I'm am working with a seller current that is completely unreasonable when it comes to just seeing the property. My contract states ZERO EMD until Due Diligence is complete. My gut says he is lying about a lot of stuff and I do not want to tie up cash in a deal that will most likely fall apartment when I get inside.

I'm not familiar at all with NJ Real Estate law, but one fundamental part of pretty much every contract is this. If you do not make the EMD by the agreed deadline the contract is void and you walk away. It will be very hard, expensive and time consuming for the seller to take you court and try to force you to execute/preform the contract. Call the bluff!

Lastly, why do you have a lawyer and Realtor, is that NJ law? If not, you have two many hands in the pot. Fire everyone and start over.

Lastly part 2

If the Seller agents even stated it won't appraise and the other offers are low, why are you paying over asking. Sound like you hold the cards with cash. I really think you are getting some bad advice from the people that should be in your corner.

GOOD LUCK!

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2 Reply

Bruce WoodruffPro Member

Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes

3y

@Patricia Sander Two things - 1) You need a new Realtor and Attorney, they are supposed to work for for and represent YOU. 2) You assume waaaay too much, that is a dangerous habit in this business....

2 Reply

Russell BrazilBusiness Member

Moderator

Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes

3y

Quote from @Patricia Sander:

Quote from @Russell Brazil:

If the contract calls for you to deposit an EMD, and you do not, you will be in default of the contract.

I already asked my attorney to terminate based on my inspection prior to contingency expiration.

And your contract states you dont have to deposit the EMD in that event?

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Craig Janet

Member since 2019 · 223 posts · 261 votes

3y

I hate to say this but your realtors and lawyers may not be looking out for your best interest. They are trying to persuade you to continue the deal because that's how they will get paid. The contract has an inspection period, you inspected it and it failed. It's that simple you can walk or renegotiate, you don't even have to explain. If you haven't paid any deposit, it makes it a lot easier for you.

2 Reply

Michael Brattelli

Real Estate Broker · Medford, NJ · Member since 2018 · 236 posts · 177 votes

3y

@Patricia Sander firstly it sounds like you do not have great representation in an attorney or a realtor. I saw someone mention this is in NJ, is that correct? Do you have a standard state contract or is there extra language added in an addendum or section 43?

0 Reply

Michael Brattelli

Real Estate Broker · Medford, NJ · Member since 2018 · 236 posts · 177 votes

3y

@Theresa Harris You can’t just say a house “didn’t pass inspection” and walk away. That’s not how it works. Inspection periods are meant for due diligence and negotiations. They aren’t pass or fail.

0 Reply

Theresa HarrisPro Member

Member since 2019 · 15k+ posts · 11k+ votes

3y

Quote from @Michael Brattelli:

@Theresa Harris You can’t just say a house “didn’t pass inspection” and walk away. That’s not how it works. Inspection periods are meant for due diligence and negotiations. They aren’t pass or fail.

Where I am in Canada you can. If something comes up during the inspection period that you don't like/can't negotiate with the seller, you can not go through with the deal. You have a inspection clause (normally 2 weeks) during which you get the inspection and have time to view the report. Same with financing.

0 Reply

Dan H.Pro Member

Investor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes

3y

Quote from @Michael Brattelli:

@Theresa Harris You can’t just say a house “didn’t pass inspection” and walk away. That’s not how it works. Inspection periods are meant for due diligence and negotiations. They aren’t pass or fail.

In my market, during the inspection contingency I can walk for anything that I find and do not like. I do not need to negotiate on anything that I do not like.

There may be market differences with respect to inspection contingency, but in my market I would simply not provide the EMD. End of story.

To OP, I suggest you end your relationship with both your RE agent and your RE attorney. Neither seem to be looking after your best interest or to provide you the guidance that they should be providing you.

Good luck

1 Reply

Cirilo Villar

Los Angeles, CA · Member since 2019 · 97 posts · 38 votes

3y

@Theresa Harris very good.

0 Reply

Cirilo Villar

Los Angeles, CA · Member since 2019 · 97 posts · 38 votes

3y

@Paul Pratt you made excellent points my friend

0 Reply

Michael Brattelli

Real Estate Broker · Medford, NJ · Member since 2018 · 236 posts · 177 votes

3y

@Joseph Beilke In northern NJ people typically have realtors and attorneys. In the southern part of the state where I am people usually only use Realtors and on occasion attorneys get involved.

0 Reply

Seller refusing asked for credits, offering repair credit instead.

Seller refusing asked for credits, offering repair credit instead.

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