The property was through auction.com and my realtor called me this morning to let me know that the property is vandalized. We had wired the funds already and waiting for the seller to reply back.
Talking to the neighbors, my realtor told me that the property was vandalized 3-4 weeks ago approx and the police were called. ( 3 people were arrested at the property). At an initial investigation, copper plumbing has been removed and some more damages to the property. This is in Milwaukee.
Anyone been through this before ? What are my options now?
1.) Ask the seller for a credit
2.) Proceed with the sale as-is
3.) Back out of the deal
We went through this on an auction property as well and ended up pulling out of the deal without issue. We asked the seller for a credit which they would not agree to.
The seller will first review their property preservation records to confirm the date when the incident occurred. If they can confirm it happened prior to when you were to close you should have an out based on a change in the condition of the home from when you put it under contract.
Would i lose my earnest money ?
Be sure to get a thurough inspection of all the property and since you haven't heard back from the seller yet ask that they pay for repairs.
You should not lose your earnest money if you pulled out of the deal assuming the seller did not want to credit you for the damage
I agree with Brandon.
I would not be totally surprise, if the sellers do not provide a credit.
Auction.com is a totally different animal when it comes to receiving credit for any damages.
Discuss earnest funds with your agent.
It depends on the terms of the auction. Some are AS-IS no inspections. Read the contract.
This happened to me 2 years ago with auction.com and the listing agent said that the damage was done prior to my bid so auction.com asked me for pictures to prove the damage which I did have so I got a $2k credit
Most listing agents have to visit the property often as part of their listing contract to check on the property's condition. (typically on a weekly basis) and they are required to take date-stamped photos as well so there should be proof on their part if it happened several weeks prior. If your offer came in after that, and it's proven that it was already in that condition, then you're probably out of luck since most sales are as-is, as-seen. If it happened afterwards and it just happened that no-one informed you, then your agent may want to reach out to he listing agent to discuss further on how to proceed.
Of course, above & below may be state specific, but I guess my question would be:
Was the property already on record at the registry of deeds? If so, (at least in my area), you already own the property so it may now be your responsibility. I doubt the seller could do anything to help you at that point. If not, did you do a final walk-through of the property prior to closing? (you always should, especially so for reo and/or auction properties as there are likely still so many buyers/agents/vendors/etc. with access to the property).
PS, first thing I always tell my investors as soon as they close... Change all of the locks immediately.
Good luck with this, hope everything works out.