Seller went MIA, how to proceed?

27 Replies

I currently have 2 4-plexes under contract. My financing will not be finished until after our scheduled closing date so I went ahead and lined up a hard money lender just in case. Before I finalize with the hard money that I would require them I figured I'd reach out to the seller and just see if they would entertain an extension or if they are set on that closing date. So either way I have  my money all set and I'm good to go with either scenario. 

Now to the good part, the seller has been pretty flaky during much of the process so far; he tried to cancel the contract once after a week into it and after i threatened legal action he settled down and said he would honor the contract. I was worried how he'd react to the extension request but figured if i have other money available anyways I might as well try, conventional financing only is going to be far cheaper. So I had my realtor send out the extension request last Friday, as of today we've not heard anything back since then. He's gone totally radio silent and the closing date without extension is the 16. I'm obviously rooting for the extension but unsure how to proceed if he just never responds with anything. 

Any input on how to handle something like this and what occurs if he just doesn't respond to it? I feel that being so close to the closing date that him no responding should cause the closing date to be pushed back irregardless of whether an extension was signed or not. 

Him not responding to an extension request doesn’t change the contract in any way. He’s probably hoping you can’t make it if he wants out. Get your hard money lined up and give them notice you’re ready to close as per contract.

He's not responding to anything though, how could we even do a closing if hes not responding?

He has to show up to the closing or he's in breach - I'm betting he knows that and is hoping you don't show up to the closing so he can cancel the contract. If he never responds on the extension request, then he never responds. Doesn't change the contract, or the closing. Might be worth having your realtor remind his realtor about the closing so there's no 'oh, I misunderstood the date' shenanigans, though. 

@Shawn Q. As far as I know there is no closing set to occur, the guy is literally not responding to anyone. What if he never even schedules a closing by the closing date, does that extend it or what? My realtor is his realtor.

Originally posted by @Alex Martin :

@Shawn Q. As far as I know there is no closing set to occur, the guy is literally not responding to anyone. What if he never even schedules a closing by the closing date, does that extend it or what? My realtor is his realtor.

The seller set up closing with the title company after they send everyone HUD-1 (if it's cash deal).

If seller doesn't respond to extension, everything is as it's in contract - you close on 16th.

If you made the offer with the listing agent - you're on your own, the listing agent's client is the seller. You're his customer and try hard to work on the deal.

Get your financing ready, don't let the deal break up because of you - you'll lose your earnest money. 

Contact the title company and ask them how it's going and when the closing. Not every state has round table closing, seller might sign the papers separately and you're on your time and place.

Follow the contract - it might be a set up for you. If seller didn't want to sell and you were threatening for specific performance suit - now it's his chance to not sell and keep your EM. 

If you have an enforceable contract you can sue for specific performance and make him sell it. If you really want to. The point is he doesn't want to give you an extension and you can't force him to. You can't even force him to tell you no.  

@Irina Belkofer If the seller set up a closing with a title company he has not made anyone aware of this, wouldn't he be responsible to let me or his realtor know where we are closing? Wouldn't there be a time frame for him to let us know that as well? 

The pa is written as financing because that's originally what it was meant to be, then the delays came into play so I lined up new financing which is going well now. If he refuses to extend the contract I can come in with hard money but hes literally not communicating at all to anyone.

I would contact the title company to see if he has any closing set up but there was never any mention of who that may be. 

@Jimmy Dudley I was considering pursuing a specific performance, but I am admittedly not that familiar with it. I did not wish to pursue it any earlier than necessary ( was hoping he would respond positively with the extension) but it's coming down to the wire now and that may be something I am forced to go after. Technically if he's just outright not responding or making any attempt to close he would be the one in breach, not myself, wouldn't he?  

I am not a lawyer. However, there doesn't appear to be grounds to sue for specific performance until after the 16th. I think he may be hoping you fail to show up and he can blow up the deal. Make sure your agent keeps records of contact with the seller's agent. That way he can't claim YOU failed to show up to the closing. 

@Jimmy Dudley Oh okay, I was thinking that was something that I had to start before. I am going to contact an attorney tomorrow to see if there is grounds for such an action and how to go about it. My agent is very frustrated with him, even though hes worked with him in the past, and has told me he would attest to everything going on. With a seller that literally does not respond to anything, I just don't see how it would even be possible to close. 

@Alex Martin the seller doesn't have to communicate with you but he does have to with his agent. Because it's his agent(!!!), the agent might be instructed not to communicate the seller's position to the buyer. 

The agent owed the fiduciary duties to the seller and he has to be fair to you as his customer.

Next time you go with the listing agent, think about agency law, not only convenience. Once you have your own agent, he'd fight for your rights and could find out what's going on.

Right now, it's best to be ready to close and if the seller won't close on 16th, then you can sue him for specific performance. I bet he's expecting that you're not going to fund the deal :)

@Irina Belkofer When you say "instructed not to communicate the seller's position" are you suggesting the agent knows what the seller is planning but may have been told to not let me know? It just seems crazy to me that I may not ever be told where we are even closing but be expected to close. 

The agent in this case knew the guy selling the property, but the property was never actually listed and was an off market deal, not sure if that changes anything though. We both did sign a document acknowledging we were aware of him being a dual agent. 

I can be ready to close but I have to know where to show up. I'd have to imagine that there is some requirement for the seller to cooperate with the closing, otherwise every seller with cold feet could just be difficult and run down the clock so to speak. 


The whole situation is just getting ridiculous. 

@Alex Martin  

Let me guess... no agents involved? Good real estate agents don't leave clients in the dark like this.

What does the contract say about NOTICES between the parties?

If I was involved, I would give immediate written notice to the seller in accordance with the terms of the purchase agreement of the date, time and location of settlement. I would tender settlement funds to the settlement agent at that time and document same. If the seller no-shows I would pursue legal action immediately and be prepared to see it through.

If you don't have a settlement agent identified in your contract as a buyer... bad. Relying upon a seller who does not want to close to give you settlement info... worse. Time to step up and start protecting your interests. If you don't have a broker to do so, hire an attorney.

Well, then it's a different story - the agent is kind of a friend of the seller. If it never been listed, how did the agent found you?

Anyway, once you both signed the Agency disclosure, you knew that he's the agent of the seller and you're on your own. If I were you, I'd request the title company info from the agent and communicate with the company directly.

Remember, that the agent must disclose to the seller everything he considers important, so if you don't want the seller to know something - don't tell the agent...and opposite is true :)

If you tell your agent that you're going to close on 16th and if the seller won't - you'll be pursuing the legal action. I'd actually contacted a real estate attorney to talk about details beforehand. 

I'm not an attorney, so I know about these cases only from examples in my field of studies. You might have some damages to be able to file a law suit against the seller. 

Anyway, it's better to remember: you don't have your agent, you signed the Agency disclosure to agree with that, so try to get all that together. The title company might help

Good luck!

@Tom Gimer There is an agent involved. He is giving me any information he has but the seller is ignoring him so that information is very limited. If the seller never choose/disclosed a title company where we are closing am I able to choose it or would that be pointless? 

@irina  

@Irina Belkofer I don't know if I'd say they were friends, I guess the agent sold this gentleman another property. The seller told the agent that he was planning on selling a property and if the agent found him a buyer he would give him commission, but the seller would actively be trying to sell it himself also. The agent and I assumed originally when he was trying to break contract it was because he had found another buyer and wished to cut the agent out. 

I actually found the agent on this site. 

If we both signed a dual agent form, shouldn't he technically be representing both of us? The agent does not know what title company the seller was planning on using, but did tell me what one they used last time so I am going to check with them in the morning. 

Thank you for trying to help me work through this..what a mess! 

A couple suggestions if you really want this property:

(1) Mail a letter to the seller at all known addresses (a) stating that you are ready, willing, and able to close, and (b) asking where the closing will take place. Include a copy of a clear to close from your lender or other proof of funds. Get a tracking number or postage certification for the letter and save a copy for your records.

(2) Notify the dual agent in writing that you intend to close. Save a copy for your records. 

(3) If there is a title company or attorney selected for the closing, contact them and try to schedule a closing for the 16th as the buyer (I have scheduled closings as a buyer before). Then send them a letter in writing confirming your closing date and/or attempt to schedule a closing.

(4) If the seller does not appear at the closing, don't stop working on your financing. You'll want financing ready in case you sue and end up getting a settlement that includes performance.

(5) If you end up needing to sue, your attorney should probably bring claims for specific performance AND breach of contract. Specific performance is an equitable remedy requiring the seller to give you the house, and requiring you to give the seller the agreed price. Breach of contract, on the other hand, is a legal remedy that results in a money judgement against the seller. The usual measure of damages is the difference between the purchase price and the fair market value. Let's say that you have a deal for $250k and the property will appraise at $310k. In that scenario, you could get a judgement for $60k. The threat of money damages is often way scarier to a seller than specific performance, and it can be used as leverage even if you what you really want is the property. As the plaintiff, you have the choice of which remedy you want.

Disclaimer: This post is for informational purposes only and is not intended as legal advice. I am not your lawyer. You should talk to a lawyer licensed in your jurisdiction for specific help with your situation. 

@Alex Martin a dual agent is never equally agent to both sides especially when their interests are clashed.

From your story updates, I guess the agent never signed the exclusive right to sell agreement but rather exclusive Agency (he gets the comissions only if he procures the buyer). Otherwise, the seller would owe him comissions no matter who found the buyer - he or seller.

If you don't know the title company 3 days before the closing, this is a dead case. I hope you get signed contract on hands and follow the advice above - get ready for the court. 

Well, I guess, it's how you get off market deals :( not easy breezy

@Alex Martin Dual agency or not, you have a REALTOR who should be representing you to their fullest. Contact the principal broker and get him/her up to speed -- the broker is your agent.

The title co. should be no mystery, I assume they are designated in the contract. As said, schedule the closing!

Who has your earnest money deposit if there is no title company/lawyer involved yet? I also have never been involved in a sale that the buyer didn't choose the closing location/attorney, however that may be state specific.

Is your agent doing all he can to reach the seller, his client? Has he sent a email and made a call, or does he reach out multiple times a day, try locating him at place of employment, home etc? Being a dual agent he needs to step up and figure out what is going on and how to get this deal to the closing table. Has he determined something hasn't happened with the seller (family issue, medical issue, etc)?

Personally I would be down my agents threat anout itand 100% ready on my end to close on the 16th (this Saturday?).

Seeing all the responses, you definitely need to get your lawyer involved. @Jacob Rhein is likely right, but only a lawyer reviewing the specific documents you have can tell you what rights and responsibilities you have. Do this today, so you can ask these questions before the closing date. As this is such a tight timeframe you may need to hire a same-day process server or courier to deliver any messages. Then just make sure your lawyer comes with you to the closing (if you can find out where it is). Seems like this situation has a high potential for closing-table shenanigans. 

One additional thought - you might want to try calling all the title companies in town and seeing if you have a closing scheduled. I don't know if they release that kind of information, but it's worth a shot (but do this after getting a lawyer). 

@Wayne Brooks The title company was not mentioned in the contract, but I did find out where the realtor dropped off the PA. I called them and they have not heard anything from the seller and the realtor cannot initiate anything with them without permission from the seller. So it would appear that he had not intention of trying to close by the deadline which seems like a blatant failure to perform to me. 

@Brian Pulaski I gave my EMD to the realtor, who is holding it. I speak with the agent every single day, he's told me that he has attempted to reach out (call,text, email) roughly 4 times a day since we last heard from him a week ago. The agent seems just as frustrated with the seller as I am. I've even starting reaching out to him myself by calling, texting, emailing, facebooking, contacting his property manager, and reaching out to him through where he lists his other rentals.

@Shawn Q. I am waiting to hear back from an attorney right now. I did find out where the closing was meant to take place and they have not been told by anyone to start anything and as such they said they would not be able to close by the deadline regardless. 

@Alex Martin do you have the signed purchase agreement?

If there is no title company in it, what else is missing?

Is it valid agreement which can be executed?

Was your EM check cashed out? Or it's just somewhere on hands?

Only broker can deposit your EM in a special escrow account if your PA states so, or the title company - agent can not do it.

If you want to pursue this property - the lawyer has to be found ASAP. 

If you already secured the loan - you've done your part of the deal. Now it's time to get the other side to fulfill the contract.

So I was forced to fight dirty and out of desperation I contacted his girlfriend. I updated her with what was going on and my intention to take it to court if he did not respond, about 15 minutes later he reached out to the realtor. We informed him that it is too late to close on the property before the contract runs out due to his inaction, so he would have to sign the extension or we would pursue specific performance. He is saying now that he will not sign the extension but instead he will sign another sales contract, not sure why he'd rather do it that way but won't that still keep him under contract anyways? 

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