spencerhoo
06-26-2007, 04:20 PM
Hello everyone.
I am a realtor in Southern California.
I had a rather interesting series of events happen during one of my last listing-side transactions. Wanted some feedback as to what my options are.
Mr and Mrs Seller listed home with me for a 3 months Exclusive Right to Sell. At the time listings was signed, Mr and Mrs Seller fail to mention that they had not been paying the monthly payment for the previous months. The question was specifically asked and they only answered that they had a pre-payment penalty on the loan.
2.5 months later, it is brought to my attention that the home has a NOD filed against it. Mrs Seller was away on vacation to Vietnam and returning later in the week. I call Mr Seller and question him regarding the NOD if he knew that payments had not been paid. He told me to wait for Mrs Seller to return from Vietnam and do not call him any more with "problem calls" as he is "weak and distressed".
Mrs Seller returns and I call her and she confirms that they had not been paying the monthly payment for the previous 5 months. I notify her that because of this extra debt (late payments and associated fines/fees) they would need to consider a short sale. They basically refinanced the house in question to purchase another house. They did not want the lender to know about the new home and instructed me to not doa short sale and they would opt to pay a small amount out of pocket in order to close escrow. A 3 month listing extension is signed.
A week later, we receive a full listing price offer, minus a small buyer closing cost credit of $5000. I calculate out a sellers net sheet and it shows they would have to pay about $10,000 in order to get escrow closed. They tell me that this is doable and continue with escrow.
Everything is fine, until the termite report comes abck saying that there are $1300 of repairs that are needed. Sellers claim they are poor and cannot pay for this. As their realtor, I offer to pay for this cost in order for escrow to close and they tell me they no longer want to sell the home.
By day 30 of the 30 day escrow, Buyers send over a Notice for Seller to Perform (complete contractual obligations of termite clearance and water heater strapping) and Sellers ignore. Buyers initiate Cancellation of Escrow Instructions.
Sellers go on to ignore me for 3 weeks, during which time it is dicovered that Sellers listed home with another broker (while I still have a valid listing). They are selling home as a pre-forclosure short sale as I had tried to convince them to consider earlier.
What I want to know, is can I sue the Sellers for Actual Loss (Marketing Costs, Gas, and other monies spent to market their property in good faith). Had they told me of the situation honestly when listing was signed, marketing would have definately been different (i.e. pursuing a short sale).
1) breach of Residential Listing Agreement when Seller verifies that property is free from non-loan liens and late payments
2) breach of escrow/contractual obligations causing escrow not to close.
What do you guys think?
I am a realtor in Southern California.
I had a rather interesting series of events happen during one of my last listing-side transactions. Wanted some feedback as to what my options are.
Mr and Mrs Seller listed home with me for a 3 months Exclusive Right to Sell. At the time listings was signed, Mr and Mrs Seller fail to mention that they had not been paying the monthly payment for the previous months. The question was specifically asked and they only answered that they had a pre-payment penalty on the loan.
2.5 months later, it is brought to my attention that the home has a NOD filed against it. Mrs Seller was away on vacation to Vietnam and returning later in the week. I call Mr Seller and question him regarding the NOD if he knew that payments had not been paid. He told me to wait for Mrs Seller to return from Vietnam and do not call him any more with "problem calls" as he is "weak and distressed".
Mrs Seller returns and I call her and she confirms that they had not been paying the monthly payment for the previous 5 months. I notify her that because of this extra debt (late payments and associated fines/fees) they would need to consider a short sale. They basically refinanced the house in question to purchase another house. They did not want the lender to know about the new home and instructed me to not doa short sale and they would opt to pay a small amount out of pocket in order to close escrow. A 3 month listing extension is signed.
A week later, we receive a full listing price offer, minus a small buyer closing cost credit of $5000. I calculate out a sellers net sheet and it shows they would have to pay about $10,000 in order to get escrow closed. They tell me that this is doable and continue with escrow.
Everything is fine, until the termite report comes abck saying that there are $1300 of repairs that are needed. Sellers claim they are poor and cannot pay for this. As their realtor, I offer to pay for this cost in order for escrow to close and they tell me they no longer want to sell the home.
By day 30 of the 30 day escrow, Buyers send over a Notice for Seller to Perform (complete contractual obligations of termite clearance and water heater strapping) and Sellers ignore. Buyers initiate Cancellation of Escrow Instructions.
Sellers go on to ignore me for 3 weeks, during which time it is dicovered that Sellers listed home with another broker (while I still have a valid listing). They are selling home as a pre-forclosure short sale as I had tried to convince them to consider earlier.
What I want to know, is can I sue the Sellers for Actual Loss (Marketing Costs, Gas, and other monies spent to market their property in good faith). Had they told me of the situation honestly when listing was signed, marketing would have definately been different (i.e. pursuing a short sale).
1) breach of Residential Listing Agreement when Seller verifies that property is free from non-loan liens and late payments
2) breach of escrow/contractual obligations causing escrow not to close.
What do you guys think?