Hi all, I am in the process of buying the house. A friend of mine knows someone who want to sell the house. In the mean time the seller put the house for sale through real estate agent and the contract will be expired next week (9/20). After I and the seller met, I have been told that there is one lady made an offer already. If I really want the house I will have to bid higher or other choice I will have to wait until the contract is out so I can buy from the seller directly and the seller will give me a good price. I love the house so I decide to bid higher and then the seller accepted my offer. We did inspection yesterday and the result was not good. No contract yet. Should I back out and wait until the contract expired then buy from the buyer directly? Is it legal? Thanks all.
Dear Aux, You don't say what state you are in, but I was an agent in TX, and the laws do vary alot from state to state, but her is my .02 cents ...most of my listing contracts indicate that even though the contract has expired if I was the CAUSE of a potential buyer and seller meeting and getting a contract, I was still entitled to a comission. So just waiting for the listing contract to expire doesn't necessarily mean the realtor doesn't get paid. Also, you mention the inspection was not good. If there are problems with the house, they will still be there realtor or not. Depending on what mortgage company you use, they may require that those problems be fixed before they will loan money, and depending on how your contract is written, you could stand to lose money if you repair those problems before closing. FSBO (for sale by owner) type sales seem to fall into litigation frequently. Its a sticky wicket on both points...I would seek professional advice in your home state before doing anything.
The inspection was not good? What was wrong? Also, most contracts with agents state in the fine print that if the house sells within so many months (3 is average) that they are still entitled to the commision. One plus to waiting is that you would have more bargaining room as the seller is not paying the commision to the agent (between 5-10 percent)
Thanks all. I am in NY and the inspector found that there is lead based. The house was built in 1953 w/underground parking. Listing Price 259,900.00 and the house has been in the market for almost a year. I made offer 248,000 and the lady before me made offer 246,000. The owner told me that he can sell me the house w/240,000 w/out real estate agent. But now I went to real estate agent already. I am not really sure if I can re-negotiate the price to 240,000.00 w/ real estate agent.
Aux, I am a realtor in MA. I'm not sure of the differences in NY and MA law, but I imagine they are similar. Typically there is a clause in a lising agreement that entitles the listing broker to a commission on a house after the listing has expired if that broker originally showed the property to the purchaser. This is usually in effect for 60-90 days after the listing contract expires. Another idea is to go back to the broker with you inspection results and try to re-negotiate your offer based on the damage or pre-existing conditions found in your home inspection. I am by no means fluent in NY RE law, this is just my .02. How did you know how much the other offer was? It's unethical for the broker or seller to disclouse this information. EdG
He would have to sell you the home for a whole lot less than that if a realtor isn't involved. The commission would have been around 4 to 6 percent depending upon where you are. If he was willing to sell for $248,000 he would have netted 238k on 4%, 235k on 5%, and 233k on 6%. Why would you pay him more than he would have netted through he realtor? I would run from this guy as fast as you can. If it has been on the market for more than a year and still hasn't sold at $248k why would should you pay more when the realtor isn't involved. He wouldn't have made that much going through the realtor so why should you pay the difference? Let him eat the differnce, offer 230k without a realtor or you walk. If your going FHA or VA the inspection will kill the deal anyhow. They won't let you buy if it won't pass inspection. Even if you don't go FHA or VA the lender may not approve until inspection is passed which means the current owner needs to get it up to snuff. It sounds like too many bad vibes with the home seller. I recommend you walk away. It is a nightmare waiting to happen for you.
Sounds fishy to me. I guarantee that real estate agent is going to find out about the sale and sue the seller and possibly you too for the comission.
