bad experience with Hubzu

14 Replies

I had a bad experience with Hubzu and just wanted to write about it for anybody else wondering how this site works. I had my backup offer approved for a property listed on hubzu on 11/12. I then went to the property and fo und that there were problems with the house like a missing AC unit and Roof that needed replacing, so I sent in a Buyer Repair Request to get the price reduced from 217,00. They came back to me on 11/24 with an offer of 210,000, I countered with 200,000 and they accepted it on 12/10. I immediately have my inspector try to enter the property to inspect it, but the lock box had been removed. I then emailed the listing agent and he said the seller will work on getting a lock box installed but I had to sen the 11k EMD immediately or the sale would be cancelled. He obviously didn't know anything about the transaction since I still hadn't received a signed purchase agreement from the seller (I signed the docs they sent but we were waiting for seller to sign) and escrow had not opened yet.

I also called customer service to ask that a lock box be installed and explained my situation.  Their customer service is offshore and they are completely incompetent.  The guy I first talked to gave me a customer service ticket.  I called later on that day to see if there was any progress made and they had closed the ticket off without doing anything!!  I had them re-open the ticket.  Next day I called and they said somebody is working on it but nothing had been done yet.  

Finally on day 4 of this ordeal I go down to the property to see if I could enter without a lock box through the window.  I drive 1 1/2 hours to the property to see that the backyard window was open and squatters were living there.  I called the police (it took them 45 min to get there, but thats another story) and had the people removed.  After doing that, I inspect the house and see that there is a leak in the roof.  Before I left the house, I installed new locks, a lock box, secured the house and emailed hubzu to see if they wanted the code for the new lockbox I installed.  Here is the email I send them:

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Hi James,

I went by the house today and found there were people who broke in and were living there. They broke the locks and removed the lock box. I called the police and had the people removed. According to the neighbors, this is the third time this happened. One of the times a bunch of the neighbors went in the house, one had a gun, and they removed the people. I installed new locks and put a lock box on the door. Let me know if you need the access code for the lock box. ,

I also found that there is a major leak in the roof, damaging the hardwood flooring. I'm fine with doing a loan and closing on the 29th as the contract states, but if the seller want's to move the process forward faster to minimize damage and potential problems from the house being vacant, I can pay cash and close on the house this Friday in exchange for a $2,000 price reduction. Please ask the seller and let me know what they think.  

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And here is their response:

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Hello David,

Please be advised that the seller is not willing to provide any credit / reduce the price.

And seller has cancelled this deal, let me know if you any questions.

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WTF!!!! I watched this property for months, spend a few more months waiting for them to respond to my price reduction requests, finally agree on a price, spend countless hours on the road driving to the property, pay $500 for an inspection, spend $100 securing the property, file a police report and get squatters out and they don't even have the decency to explain to me why the seller is cancelling!!!!  Beware when dealing with this company, it can be more trouble than its worth.

Not cool at all. As inspectors, we try to find out about the situation before agreeing to a job like that. I hate for clients to lose money. Thank you for sharing.

Yes, it almost seems like one hand doesn't know what the other is doing.  On one hand I have the document processor negotiating with me about the price and on the other hand the listing agent looks at the contract and sees no progress.  It's very frustrating dealing with them and has cost me hundreds of dollars and hours of my time with nothing to show for it.

Originally posted by @Britt Treece :

Not cool at all. As inspectors, we try to find out about the situation before agreeing to a job like that. I hate for clients to lose money. Thank you for sharing.

 I don't blame the inspector at all.  I asked them to inspect the property and they did just that.  I think the blame falls on Hubzu 

@David Mirza

While it definitely sounds like their customer service is sub-par (which I don't find very surprising), I think you may have hurt yourself where closing this deal is concerned. If I understand what you wrote, you agreed to a purchase price of $217,000, then after looking at the property you were able to negotiate down to $200,000 for the required repairs. I think that figure needed to include any additional costs reductions you needed - When you went back to the well again for another $2,000 - I'm not surprised that the seller decided to back out. Moving the process forward faster is in your favor, as the damage to the home is ultimately going to be your responsibility after the deal closes - I don't think the seller should be penalized for helping you out. Removal of the squatters and changing the locks may also have been a red flag for them, as these activities should only be performed by the legal owner of the property. 

I just think you were trying to do too much and get too much in return. If this were my deal and I wanted to close on it, I think i would have suggested we move up the close date but without any price reduction. After closing, I would have dealt with securing the property and removing the squatters.


-Christopher

@christopher brainard, I disagree with you.   Regarding the $2,000 price reduction, I made it very clear that I was ok with it if they wanted to stick to the current contract.  While it helps me, it also helps the seller, so I think it's fair to try to get a bit of a discount.  In addition to that, there are costs to opporunity costs to paying cash for a property vs financing.

With regard to changing the locks, the alternative was to leave the home open to anybody who wants to enter with the locks removed as I had found it.  I don't think that's what the seller would want.  I did offer to give them the access code so they could go in and put their own locks as they wish.  I don't see anything wrong with that.

Originally posted by @Gloria Mirza :

I figure out what happened.  It turns out they had another offer for 235k and the seller hadn't signed my offer yet, so they went with another offer.  

That is terrible, but at least you are not the person that got stuck with it for $235!

I took care of the problems Sunday and they cancelled the contract Monday morning.  I don't think that is what enabled the seller to buy, Hubzu does not move that fast :-).  When you have squatters in the house and a leaky roof, you just have to move quick before the problem gets worse.  I wouldn't say I "fixed" the problems though, just stabilized it by kicking the squatter out, putting in new locks, and putting two garbage cans in the house to catch the water leaking from the roof.  I took a $200 gamble and lost this time.

I realize that this happened almost 5 years ago, but I'm intrigued.

I understand that you wanted to purchase the property, and were looking forward to it.

But why would you invest your time (which is valuable), effort and personal finances for a property that you didn't personally own? 

All real estate sales, at least in Michigan, are made with the stipulation that no improvements, changes or updates can be made until after the conveyance of the deed (i.e. as in actually signing the paperwork that puts the deed in your name). It just seems that you used your resources to such an extent.

Not trying to personally attack you, I'm just curious.