All Forum Posts by: Account Closed

I recently purchased my first home this past Thursday. Leading up to it felt like a dream come true, I found the perfect home. I could not wait to finally settle and move in. Settlement day came and it was a nightmare to say the least. First let me say the contract clearly stated settlement would take place on the 29th no later than 4pm. I get a call two days before from the realtor saying it was pushed back to the 30th and there was nothing he could do about it. So the seller had an extra day to clean up and get things packed I suppose. Settlement was rescheduled for the following day at 10, walk through at 9. I get to the house for the walk through and they are still packing. I go into the house and I kid you not, its completely trashed and looked like a foreclosed home, holes in the walls, carpets stained all over, dog waste on the carpets, blotches of paint on the walls, missing shelves from the walls, missing nest ac unit that was supposed to come with the house, dog waste all over the backyard, refrigerator filthy, unswepped floor, mold on the washer. None of this was there when we did our original viewing of the home, as well as the inspection. The home appeared in fantastic condition and well taken care of, it was like a completely different house on settlement. Note this was NOT sold as, in fact it was listed as move in ready and taken very good care of. States in the contract it needs to be in the same condition as the original viewing. Im there at the walk through, clearly shocked, telling my real estate agent the house looks destroyed this isnt right, they need to fix this. He tells me he will take care of it. Before signing the papers he assured everything was taken care of. I go back to the house and sure enough it is in the same exact condition. My realtor basically told me its the sellers agents fault and theres nothing we can do. I know a lot of people are very experienced in real estate on this forum and I would love to get your opinions on this situation and what you would do from here. I feel like my agent put no effort in supporting me and it is really disappointing to know that. Im also livid to say the least that we gave the seller a whole extra day which was not ever agreed to on the contract and the house was left like this. Opinions please!

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Update:

Seller finally responded and they are extremely upset about the appraisal and want us to pay all closing costs as well as pay for another appraisal, HA! My agent told them we are not paying for another appraisal and unless they want us to walk away, they are paying full closing on top of the appraised price. Looks like we have the upper hand here.

On top of that, we found a much bigger and nicer home (even includes a pool), nearby and our agent is very close with the seller. We are visiting tomorrow and are a lot more motivated to walk away from the current house. The only reason we are keeping the deal alive is a backup plan (in case the house we are seeing tomorrow is too good to be true).

Keep yas updated. I appreciate everyone's input.

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Originally posted by @Russell Brazil:

The seller is well within their right not to respond, and very well may be doing so strategically. If you have an appraisal or a specified financing contingency, there is likely a a time constraint associated with it and that clock is ticking down. Once you get past that contingency, then you may not have an out on the contract.

Also was this property a FSBO? A FSBO is always going to appraise low because a private seller does not know how to work with the appraiser or speak their language. This is a huge factors in why FSBOs dont sell. About 90% of FSBOs end up having to list with an agent, and here is a perfect example of why.

Also i would hardly say putting in $40k to get $50k is being greedy.

We were thinking it was their strategy to get the most out of us, they likely assume we are emotionally attached to it and will do whatever we can to get it. If we do have the contingency you speak of, how would we come to an agreement? Or does that mean I would lose the money deposit?

They a flipping company, so I assume this is not considered an fsbo unless I am incorrect in that assessment.

They bought the property for 85k put in 40k for 125k total and are trying to sell it for 175k, that's what I meant by 50k profit.

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Originally posted by @Shane Baganz:

It's difficult to understand all that you have in front of you, the intangibles so to speak. And, you know the facts. Unless its a cash offer, the house will sit. Banks won't go over appraised value.

It also appears that you may be emotional and frustrated over this deal. Anyone would be. But, here's the key. Keep emotions out of it and walk away. The owner may feel you'll come up more. When you don't, they may become fearful of losing your deal. Then, guess who has the upper hand? You do. Bring the right mindset to this deal. Pay attention to your gut. If you've been calling, stop. See what happens....

I completely agree. I know my emotions came into play due to the appraisal coming in with two weeks left and all this time I was planning the move. Not to mention I really do like the house. My fiance has been ready to walk away since we received the appraisal, which helped me see this through a different scope. Very likely we are walking away tomorrow night because I doubt we will hear back from them.

That's how I know they are playing a game with us, because they would have backed out if they didn't want the deal. The fact they are stalling this tells me they want us to give in and pay the full closing. I agree walking away is the best move here.

We will see.

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Originally posted by @Natalie Schanne:

@Account Closed The seller thinks his house is worth every penny you offered to pay him, regardless of the appraisal amount. "What the house is worth" is subjective, even to the appraiser.

What you can do:

- Ask your buyer's agent to ask the listing agent if the owners/sellers wish to negotiate a suitable deal with you by X time or that you are cancelling your contract due to clause #. Ask your buyer's agent to explain your contract and your choices to you.

-- At $10k over appraised and 80% conventional financing, you probably have at least $2k more cash available. So you can offer up to appraisal + $2k cash as purchase price if you really like the house.

In your advantage:

- Vacant properties cost $$. People are usually willing to negotiate for a few thousand dollars to close sooner.

- If the person stands to make so much money, he might be willing to take a little less to have cash in hand.

To your disadvantage:

- If the seller has strong external interest in the house, the price might go even higher if your contract falls apart. It's getting to the March/April/May Spring selling season. He may have already received some backup offers. There's nothing preventing him from making $60k or $70k off the next buyer instead of $50k off you.

Supply and Demand.

Keep us updated.

They had their original appraisal done with a comp over 2 miles away giving them the appraisal of $170000 over our fha appraisal with a comp 1 mile away of $150000.

I agree they think the house is worth more than it is appraised at. I think the square footage of the house makes it not worth the extra amount and that our appraisal is far more accurate. It is a small house with not much space the only reason we liked it is because it was refurnished and somehow managed to fit 4 beds and 2 baths. However, like you said more offers will likely come around spring time, if they haven't already.

We gave them until tomorrow to give us an answer because almost a week away from settlement and not hearing anything from them is ridiculous. Unless they want to accept our offer (which is unlikely) or give a reasonable offer in return, we have much bigger and nicer homes lined up for this weekend.

I will follow up when it's final... appreciate your input.

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Originally posted by @Natalie Schanne:

Alex Siravo - Put yourself in the seller's shoes.
1. Did you make an offer for X price? Yes.
2. Did anyone force you to do that? No.
3. Did the seller have other opportunities / offers / pending house showings to other buyers before you signed and agreed to a contract for X price with them? Yes
4. Does the seller think their house is worth at least X price? Yes
5. Can real estate appraisers be methodical and slightly off market values? Yes - a different appraiser would likely have a similar but different market value report for this house. If prices are rising from multiple offers/high demand, appraisals will be often be lower than market / sale price.
6. Does this house have features you like over other houses such that it is worth X to you? Yes/No?

If your contract is contingent on financing/appraisal, you can get out because your lender can write a letter saying you weren't approved for the loan (given the appraised value of the collateral).

If your offer is not contingent on financing/appraisal, you have a binding contract (subject to any other contingencies) and will be expected to come to settlement with all the $$ and get the keys.

If you want this house, you said before to the seller that it's worth X to you.

You can
A) come up with the 10k cash differential at closing to pay X price given your loan on the appraised price.
B) try to see if the seller will lower his/her price to the appraisal. The seller views this as shady. Seller may cancel because you've cancelled. Seller may put house back on market and might sell end up selling for less than appraised value, but not likely to you. Or they might sell for X or more to a buyer with enough cash at closing.
C) meet the seller 'halfway' where you pay above appraisal and the seller accepts less than X.

Good luck. Let us know how it goes.

Yes I am forced to do that because my lender only finances the appraised value. I am not paying more than the house is worth. We already offered below what the appraised value was initially, but the seller was greedy and upped the price. On top of all of that the seller posted on their facebook page they put only $40,000 into the house and are trying to make over $50,000 profit . It is shady for the seller to not respond after 4 days, it is actually ridiculous. I am putting myself in the seller's shoes and I would come up with an answer within a couple days. Completely unprofessional seller here. Either they accept the offer or counter, but sitting on this waiting is wasting both of our time, WHEN WE ARE EXPECTING TO MOVE IN NEXT WEEK. The appraisal is going to remain the same for months after the fact if we walk.

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Originally posted by @Account Closed:

You should call a local real estate broker to help you. I am assuming you are not currently using one? A real estate brokers job when working with a buyer is not necessarily finding a house. We can show you all sorts of houses, but you will ultimately pick what you want. The biggest part of the brokers job is to make sure you get to closing on the house that you picked.

Only my real estate agent. Will the broker actually come up with a settlement? I do not want to invest any more into this if the deal ends up breaking. How much do they generally cost?

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Currently in the process of buying a home (or so I thought) and I just got the appraisal with two weeks until settlement. The appraisal was $10,000 less than the price we agreed on. Seller was also paying full closing costs.

We offered the appraisal price plus seller still pays full asking since we don't think we should be punished for them listing it over what it's worth. 4 days later and we still haven't heard back. What would you do in this situation? The seller has been giving us a hard time since the start when it comes to negotiating, we wonder if they are just waiting for us to put in another offer more in their favor (we pay full closing). Should we just back out and continue our search?

Thanks!

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Originally posted by @Matt Lefebvre:

It varies area by area. In NH, its standard that all inspection costs are borne by the buyer. They pay for a general inspection and a septic inspection. Its not required to get it pumped before closing, just to have it inspected and be in working condition. Goes to show you how different states are in their requirements and how people seem to do business. $700 seems fair for an all-inclusive package though.

Thanks Matt, I will keep that in mind!

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Originally posted by @Mike Cumbie:

Hi @Account Closed,

I can't speak to your area but the standard around here is that the seller covers septic. A couple reasons.

1) The seller has to have it pumped in order for the bank to finance so while they do the pumping they do the inspection.

2) The inspection can cause other issues and if the buyer pays then they are responsible for returning it to it's original condition (which in theory could cost you thousands to return it if you find it unsatisfactory). For instance while pumping it out the sidewall is so thin that it cracks. Well you had it pumped and now it is unusable until the distribution box gets replaced. That's on you now. Well you also found it needed a new electrical panel and want out of the deal..... Sure after replacing the distribution box.

Not to scare you or anything just things to think about and everything is negotiable in RE so buyers do sometimes do it. Maybe they just trust their guy and that's fine.

But in my area 700 would be about right for an inspection/septic inspection and pumping

Good Luck

Hi Mike,

I appreciate the advice. I am in south jersey so I will check with my realtor to see if we can have the seller pay for the septic. The septic is the only thing I am worried about for the reasons you listed above.

Thanks for confirming the price is ideal. The guy doing it is going to check thoroughly (cameras and everything). Before I sign the contract going to run this by the realtor/lenders.

Thanks!

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All Forum Posts by: Account Closed

Account Closed has started 4 posts and replied 19 times.

Post: Bought my home and the ending was a nightmare

Post: Seller not responding with 2 weeks until closing

Post: Seller not responding with 2 weeks until closing

Post: Seller not responding with 2 weeks until closing

Post: Seller not responding with 2 weeks until closing

Post: Seller not responding with 2 weeks until closing

Post: Seller not responding with 2 weeks until closing

Post: Seller not responding with 2 weeks until closing

Post: Just bought a home- Inspection time- Question

Post: Just bought a home- Inspection time- Question