Rental Property Investor · Lathrop, CA · Member since 2019 · 12 posts · 0 votes
Hi All,
I am buying few properties in MO, the seller signed an agreement for a conventional loan but she verbally told me that she would like to close the deal with cash! Can she do this? I do not wish to do a cash deal at the moment. Also, she would like to close the deal within 15days. Should I pass on the deal or should I push back on her? Any suggestions would be appreciated!
@Pawitar Singh is this transaction going through real estate agents? Did an attorney draft the paperwork or is this using standardized purchase agreements for your local area? Typically a real estate agent explains the process to people, but it almost sounds like she didn't understand what she signed.
If the contract was well written, it is legally binding, but of course you can't make someone close on a sale. It is better to work through it instead of trying to force it. If there are real estate agents, that is their job. If it is just you and the seller, it could be hard.
@Pawitar Singh is this transaction going through real estate agents? Did an attorney draft the paperwork or is this using standardized purchase agreements for your local area? Typically a real estate agent explains the process to people, but it almost sounds like she didn't understand what she signed.
If the contract was well written, it is legally binding, but of course you can't make someone close on a sale. It is better to work through it instead of trying to force it. If there are real estate agents, that is their job. If it is just you and the seller, it could be hard.
There is something fishy going on here, the seller either is trying to back out of the contract either because they need quick money or they have a better offer on the table. Either way if an attorney drew your contract i`d have them make sure you have clauses in place to address such issues. Did you already give the seller your EMD ?
@Redgy Saint-Germain hi Redgy, you might be right that they need quick money and I don't have an attorney on board. Yes, I did send out EMD to title report company.
@Wayne Brooks hi Wayne, I don't know why she thinks it is a cash deal since the contract she signed is conventional. That is why I am asking here.
I am buying few properties in MO, the seller signed an agreement for a conventional loan but she verbally told me that she would like to close the deal with cash! Can she do this? I do not wish to do a cash deal at the moment. Also, she would like to close the deal within 15days. Should I pass on the deal or should I push back on her? Any suggestions would be appreciated!
Sincerely,
Singh
15 days is really 11 days by the time your lender gets everything needed to really get going (you're losing a day here on the internet, for example, and then you're going to lose another day b/c your LO will ask you for "bank statements" and you will upload a cell phone screenshot, and then you will lose 2 days when there's a typo on your insurance that the insurance agent takes two days to fix, and so on).
11 days is unrealistic for a complex investor scenario. 18 or 20 (which is really more like 14 to 16) is realistic if you find a fast lender, and then (in CA at least) the 'notice to perform' buys you another 3 days. So you have the option of playing ball (smile and nod along) and at the last minute getting a 1 week extension + the 3 days. It's a risk, but 19 times out of 20 the seller and listing agent will conclude that giving you the extra week is faster than starting from scratch with a new buyer. And if you are that 20th time out of 20, point to the contract: verbal contracts hold no weight in real estate, all that matters is what is written above the signed line which is dotted and THAT says you get to use a normal loan. They want to play stupid bait and switch games, they get to win stupid bait and switch prizes.
("Play stupid games, win stupid prizes" is a military saying derived from, for example, popping a drug test a month from an honorable discharge after 3 years and 11 months of doing what you're supposed to do)
I had a similar situation happen to me. The seller had signed a standard agreement. I contacted my attorney and he said the deal would proceed as agreed upon. If the seller refused to close, we would sue for breach of contract. I was planning on moving into one of the units so my attorney further advised me that if the seller refused to close that I was to put all my belongings in storage and check into a hotel, the costs of which would be paid by the seller. In the end it was a bluff and seller closed on the deal.
@Dennis Cosgrave Hi Dennis, Thanks for the insight. I hope this seller is like that too. I don't want to go through the legal process as it is a headache.