Should I/Can I Renogiate or Pull Out of Deal

11 Replies

I won a 4 Bed 21/2 Bath House in Indianapolis on Auction.com on March 20th. It was a foreclosure from Bank Of America. The first communication was that closing would be Apr 9th then after contract signed closing was going to be Apr 20th. Then an extension was signed until Apr 27th because title company was waiting on estoppel from HOA. No communication from company until I called the title company last week on Wed and was told only waiting for BoA to sign off on a $50 code violation (abandoned car) and they should be receiving that back that day or Thurs. No word. I called yesterday (Wed.) to auction.com. They transferred me to an answering machine.

But here's the problem.  I did know of some water damage at the time I bought it.  Took photos.  I went by the house today and looked through the windows and where some walls were white  and no water damage obvious on Mar 21st, they are 1/4 covered with mold now.  The sheet rock that did have damage doesn't look like any obvious mold.  Probably because they are getting air.

Since extension ran out, I assume I can pull out and get my earnest money back.  Would I also get what I have already paid for title service and recording?

Now it as-is but I bought as-was.  Could I successfully renegotiate to have them do the mold remediation and to have certified?  I know, it's BoA.

Anything else I can do?  Any creative ideas?  I really wanted this property but I can walk away.

Thanks BPers

317-801-2266

It will spell out the terms in your signed contract. Usually, if the extension is from the bank and they fail to perform and close on time you should be able to get your earnest money back. It should address any fees paid to title etc as they are very specific about things like that. 

In regards to the mold, not certain you would be able to negotiate the price down. May be worth taking some pictures and sending over to the asset manager to review because they don't have a clue what the condition of the property is. It's worth a shot. If anything they may drop the price when they put the place back up for auction if you walk away.

What does the contract stipulate regarding their right to extend the closing date?

I understand they can jerk you around for an extended period of time and you don't have a choice.  

Normally the seller has to give you the property in the same condition it was in when it went under contract but I bet they have a CYA that takes care of that also.

You need to send the contract to your attorney ASAP.

As several other people have said, I would first & foremost ensure that you have & maintain your right to walk away given the delays on the seller's end.

After that is done, you can say to them that there has been a "materially change" or "DEFECT" that has occurred since you bid on the property for which you would like a "repair credit" at closing of $x.  If you have before & after photos, send them along with your request.

B of A can be quite difficult to deal with, and this was likely one the Countrywide properties, so don't expect them to be easy.  However, given how much time has passed from the auction & closing, they are likely motivated to get the property off of their books and not start all over.  

You can also mention to the listing agent/seller that if they don't go through with the transaction with you (and give you the requested repair credit) and decide to relist, they should - in principle - disclose that there are mold issues in the relisting, and that will pose further problems for them.  In short, you are saying to them that they have to deal with the mold issues, either with you or with someone else.  

Good luck!

Good advice @Matthew Schroeder .  Especially about them dealing with me or somebody else about the mold and telling them to disclose in the relist.  I think my terms will be for them to remediate the problem or I walk.  I was thinking that since they have spent so much time that I may have an opportunity that I didn't see.  You've shown it to me..

Thanks

317-801-2266

I will be talking to my attorney on Tuesday.

317-801-2266

@Dennis Weber

  out of sheer curiosity... is his a closing attorney you speak of ?  all the deals I have done I Indy has been through Meridian title we never use attorney...

So will this attorney you talk to charge you for this ?  Or if they are handling the closing questions about the deal are included in their modest closing fee's.

would hate to have to pay an attorney to consult over a 1k EM half your money could go by by talking with them  :)

@Jay Hinrichs

 Okay, saying "my attorney" was lazy and misleading.  He is an acquaintance who is an RE attorney that I will happen to run into on Tuesday :)  May cost me a beer.

317-801-2266

@Dennis Weber

  now your talking.... I just see so many folks in Attorney driven states first thing out of their mouth is I have to talk to my attorney... were here on the west coast only time we EVER talk with an attorney is for estate planning or if we are sueing someone or being sued... if you can go years without talking with one your doing it right.  LOL

There are pre paid legal plans available that make talking to an attorney very affordable. I have found that talking to an attorney before making a mistake is much less expensive than talking to an attorney afterwards.

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