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  1. #1
    Join Date
    Jun 2012
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    2

    Default Seller's Options when Buyer Backs Out at the Last Minute

    My question involves real estate located in the State of: WA

    We were to close on my house on May 31. We declined another offer to accept this offer. After all requested repairs were made following the inspection, the appraiser was to come and re-inspect. We were getting close to the 31st so I asked my agent to ask the buyers if I could rent back the house for a month while searching for my own place to live. I was told by my agent that that is not usually possible and to make arrangements to move since I would have to turn over the keys on the closing day. At this point, I had 8 days until closing. I sold all my furniture and other belongings,since I was planning on downsizing from a large 3 bedroom house to a one bedroom condo, and moved out on the 28th. The appraiser came for re-inspection on the 29th. I signed a contract extension since the lender said the appraiser was taking his time turning in the paperwork. My agent said that the lender assured her that the only thing holding up the loan was the appraiser's paperwork. Then a week later, I was asked to sign another extension as the buyers had changed their loan type from a VA to conventional. I signed the extension. Then the next day, my agent called to tell me that the buyer's loan was not approved because they had included child support as part of their income and it was not a consistent income. This was NEVER a concern. I was led to believe that the only thing holding up the process was the appraisal report. The buyers signed a rescission forfeiting the earnest money of $3000. My agent says "sorry". Other than the signed rescission forfeiting the earnest money, I have no documentation of the reason for rescission. For all I know, they changed their minds and is giving a bogus reason. When I requested to get a written document for the lender's loan denial, my agent just said she's not sure if she can because they forfeited their earnest money. Now, I sold EVERYTHING I own to downsize and already moved out on the advise of the agent. I am now under a lease for 1 year that I cannot get out of. My agent led me to believe, and says that she was led to believe, that the lender had "assured" her that the loan was good to go as soon as the appraiser turns in his paperwork. I think it strange that the buyers were so easy on forfeiting their earnest money, especially if it was the loan that was not approved. I have a suspicion that they probably found another place that they liked better and wanted to back out of the deal. What rights do I have?

    At this point, I want to sue my agent for her incompetence and the buyers for screwing up my house sale and financial situation. I now have an empty house to show potential buyer (instead of a nicely furnished home), no furniture to furnish the home even if I do move back to the house, no other offer since i declined one to accept this one, and have to pay more mortgage until the house actually sells, and having another lease that I signed that I cannot get out of. Am I entitled to get a copy of the loan denial and the reason? Can I get the appraiser's report? What documents am I legally allowed to obtain? Should my agent pay out of her pocket to stage my house for further showing? Has anyone heard of such a situation???

  2. #2
    Join Date
    Sep 2005
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    98,846

    Default Re: Seller's Options when Buyer Backs Out at the Last Minute

    You appear to be stating that you chose to accept the buyers' forfeiture of their $3,000 earnest money as compensation in full for their breach. If that's what you did, you've been compensated and you can expect the buyers to be disinterested in providing you with any additional documentation.

    I'm not sure why you believe it's your agent's fault that the buyer's financing fell through.

  3. #3
    Join Date
    Jun 2012
    Posts
    2

    Default Re: Seller's Options when Buyer Backs Out at the Last Minute

    I have not accepted the buyer's forfeiture of their earnest money as compensation yet. Right now, I want to make sure that, prior to accepting that as my compensation, I have explored all my options, which is the reason I'm writing on this forum.

    I am not blaming my agent for the buyer's financing falling through. I am, however, blaming her for her incompetence in giving me adequate advice, eg. telling me that I should move out and not trying to find any way for me to have time between moving out and closing the deal. I was weary of moving prior to having all papers signed but she told me that the lender had "assured" her that all would go through as soon as the appraiser turns in his report.

    Can buyers simply back out of deals giving a verbal excuse and not have to provide written documentation of things? If that's the case, there seems to be absolutely no protection for the seller.

  4. #4
    Join Date
    Apr 2009
    Location
    Somewhere near Canada
    Posts
    35,894

    Default Re: Seller's Options when Buyer Backs Out at the Last Minute

    You're not entitled to receive written documentation of anything like that. While I sympathize, this is not uncommon with real estate transactions.

    It's also not the agent's responsibility to make sure you have either enough time or adequate or alternate plans. The agents don't have crystal balls, either, unfortunately.

  5. #5
    Join Date
    Jan 2006
    Posts
    38,867

    Default Re: Seller's Options when Buyer Backs Out at the Last Minute

    what does your contract say to the situation? Does it state the earnest money would be considered liquidated damages should the buyer fail to complete the contract? If so, the earnest money is what you are due and that's it.

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