We saw a couple of deals with this clause that beat us out when things earlier in the year. Our agent told us this might be a good distinguishing point in our bid.
Hence we put in the 21 day closing.
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Jimmy[/quote]
jimmy, IMO, your agent did you a HUGE disservice. He/she should have insisted on a preliminary title report within 72 hours of opening escrow if they were too incompetent to check the public tax screen themselves, and, in any case, should have insisted on having the PTR in their hands. You, as a buyer are entitled to this knowledge early on, ESPECIALLY since you agreed to such a short closing window. Had they done that small 45-second task and found out both tax installments weren’t paid for FY 12/13 and a penalty was added, this fact would have alerted them to poll the listing agent mercilessly as to the condition of the mortgages, including seeing proof that the mortgages on it were up to date or threatening to rescind the offer. Any agent and/or broker worth their salt would not have put their buyer in such a precarious position in light of the fact of the multitudes of sellers that have been behind on their payments in recent years.
If it took you three weeks to get the PTR, you likely used the listing agent’s “recommended” title company so that he/she could intercept your report and your contingency approval period would expire without you seeing it. OR the “fix was in” so that your agent couldn’t get the report. OR your agent DID get the report but withheld it from you to buy time, while the two agents tried to put their heads together to figure out how to make this deal go through so they could make their commission.
You don’t really know how long these “sellers” have been squatting without making payments. For all you know, it could have been 6 months (since the first FY 12/13 tax installment was due and they had impounds) to 3 years. You (and likely your incompetent agent) doesn’t know how much of a short pay your seller’s lender(s) are now (at the 11th hour, lol) being asked to take, nor do you know if they will cooperate. IMO, the listing agent in this transaction is completely unethical and also incompetent if they think they’re going to successfully market a property that they KNOW is a short sale without advertising as such. And if they didn’t know it, they should turn in their license right now because they have absolutely NO IDEA what they are doing. Their broker should have advised them (and pounded it into their heads) years ago they they have a duty to let potential buyers know up front that their listing is a “short sale” so they can make an educated decision whether to place an offer or not. Here is a long version of Holmes’ holding but there are several online:
…Holmes v. Summer is a precise example of how the culture of seller dominance and the attendant and deliberate dilatory disclosures have gone awry, rendering the previously acceptable “standard operating procedure” virtually criminal. Certainly the willful withholding of facts, which are necessary for the buyer to determine a fair price and that the property is suitable to be purchased, is reprehensible conduct deserving of suspension or revocation of a license for dishonest conduct.
Holmes v. Summer provides a watershed moment in case law for brokers and their listing agents. Holmes reestablishes proper conduct for listing agents and their brokers regarding the timing of property disclosures (specifically title condition disclosures in the Holmes case). Holmes mandates that all disclosures of material fact about the property, known to either the seller or the listing agent, which might influence any of the buyer’s decisions about purchasing the property must be made to the buyer by the listing agent prior to acceptance of an offer, not after an offer is accepted and escrow is opened, as has become the generally accepted custom amongst brokers and agents today.
Listing agents are on notice: you must now Holmes-proof yourself and your seller in order to mitigate exposure to liability – up front risk reduction – and ensure that you are fully performing both your specific duty to your client as well as your general duty to the buyer.
Buyer’s selling agents beware: the listing agent’s custom is deeply ingrained and you will need to insist on full disclosure prior to preparing and submitting an offer. Market conditions with a dearth of buyers, such as we are currently experiencing, demand selling agents be more vigilant in securing the proper disclosures for their buyer…
The listing broker (if competent themselves) is well aware of the perils and brokerage liability of taking a listing of a delinquent homeowner without advertising it on the MLS as a short sale. By not doing so and accepting a buyer deposit and 21-day closing (as in a traditional sale), they are exposing their brokerage to buyer damages. That is why SS listings don’t require earnest money from a buyer whose offer was accepted by “sellers” until it is lender-approved and the buyer is still interested at that time and elects to open escrow. The “sellers” in these cases have no authority to “accept” any offers in reality and in any case, cannot convey clear title to anyone.
I don’t blame you for feeling you’ve been duped because I feel you HAVE, based upon your posts on this thread. These are just the type of “sellers” who would end up stripping the place before they leave and their agent would attempt to close the transaction anyway by not making it available for you to do a final walk thru at the 11th hour.
I’m still astounded by the level of sheer incompetency of RE agents and their broker oversight today … from the sublime to the ridiculous.
