Items to Check
Items to Check at Offer Time – Check, Check and Double Check
Copyright © CAROLYNE REALTY CORP. 2005. This information may not be reprinted or reproduced in any form without the written consent of the copyright holder. (Part of a forthcoming book – draft format only) – Disclaimer: Laws vary from state to state, province to province and sometimes even within tiny jurisdictions. Study your local laws and base your decisions accordingly. This is not legal advice. If you have legal questions always check with your own attorney.
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Presuming you have hired a Realtor to represent your interests regarding real estate, and you now have been made aware that an offer is forthcoming, it would be prudent for you to make arrangements for a face to face meeting with your Realtor to sit down and discuss one on one the opportunity you are going to take into consideration, in the form of a contract. You have interviewed a Realtor with the prospect of hiring him or her.
If he suggests, when taking your listing, that you should sign any kind of document permitting him to make decisions on your behalf regarding any offer that may be forthcoming run, don’t walk, away. Some agents are suggesting that homeowners do not need to “see” an offer as a physical piece of paper to negotiate an offer, and suggest that they, as the real estate agent, be given the authority to reject offers on behalf of the owner(s). More than the price is involved in any part of the decision making process regarding an offer. The law says that you must be made aware of every offer that is made on your real estate property, and typically you would review any and all offers, and either reject an offer and sign that you have rejected it, or work with it, making whatever changes you wish to make, until the offer reaches a point where all concerned are satisfied and you have a contract heading for completion.
A Realtor must never be empowered to make decisions on your behalf without an official power of attorney, a legal document, sworn in your lawyer’s presence giving power to “someone” to sign on your behalf. Mostly it should never be your Realtor who is making these sorts of decisions on your behalf. Even if the Realtor is a long-time friend, associate or relative, it puts the Realtor in jeopardy and it could very much put you in jeopardy. It would not be a prudent decision to forego the making of such a decision by putting such decision making into the hands of your real estate agent. You need to physically view “any and all” offers, because the price offered on an Agreement of Purchase and Sale is not the only important item on a long list of issues that are dealt with on an offer. (Read other articles: “Best Contract: Best Price” on our web site that address these issues more fully).
Some top producing agents run short of time, since there are only so many hours in a day. You list your home with them, and you never hear from the again. Occasionally you can reach an assistant. When offer time comes they have pre-instruction on the listing form that the other agent should fax the offer to the listing agent, who then will make a decision as to how or even whether or not the offer will even be presented to the homeowner. The other agent has a right to receive a validation or verification that at least the homeowner has reviewed the offer, even if he has rejected it. In some cases this is not happening. Weeks and sometimes months go by and a house doesn’t sell. Unbeknownst to the owner, there actually have been offers, offers rejected by the listing agent, offers that were never “negotiated” by the owners. Don’t permit yourself to be put in this position. You are paying big dollars to your chosen agent. See that he does his work for you to the full extend of his capacity. That’s what he has been hired to do, not play fax-phone tag and tell other agents on your behalf, that you are not interested in reviewing an offer.
If you are out of the country or even out of town, fax machines and telephones can provide you with hard copy and a method of communicating to get the job done, and relocation business has been done using these facilities for years, but finalized true documents ultimately, ideally, must be produced prior to closing. If you are in town, and your property in located nearby, make arrangements to sit with your agent for a minimum of a couple of hours to review the documents and carefully decide how you want to proceed. There is no need to rush. Being in a rush is totally different than being in a hurry. You can make a hurried decision due to time constraints, but rushing often causes major mistakes to happen, sometimes mistakes that cannot be changed. Check everything. Check again, and then check to be sure you know what you have done.
Items to Check at Offer Time
When you receive an offer (Agreement of Purchase and Sale) on your listed property, there are certain items that need an extra pair of eyes to double check that the points of reference are absolutely correct.
For starters, this is a “negotiation” procedure, not a competition. It is not a matter of who can talk the loudest, who can speak the longest, or who can “win” one over the other guy. In a competition, someone wins, and someone loses. In a negotiation, everyone should, in the end, feel “satisfied”; pleased that they received fair market value for their property as a Seller, and pleased that as a Buyer they have purchased a property they will now turn into their own home, at a price that they feel satisfied with as well. No one should have to “settle” for too little, less than the market will bear, for the property, but by the same token no one should pay tens of thousands of dollars more than current market value either.
But the price on the offer is only the beginning. You need to double check that you are in fact selling the correct property. The township or region or local municipality identifies property by other than your street address or mailing address. Land is broken down into plots or lots, and are often a plan of subdivision, or otherwise identified on a map of the area located at the local registry office, and each one has an individual identification number that travels with it through owner to owner. When a listing appears, the ID number is shown as a lot and plan number, typically. When an offer is prepared the typist uses this information to draft the form, and the closing attorney and title company if one is involved, will use this ID to make sure that you are selling what you own, and the Buyer is buying the property as identified on the subject property listed. If the number is not correct, it can be changed on the offer at the time of preparation, or at the time of presentation. Double check that your property ID is in fact correct. It would not be the first time that your Buyer bought your neighbour’s house instead of yours. You will see verification of your lot and plan both on your survey, your deed and on your tax bill. If this information is not correct on your offer, in the end you may very well have sold the Buyer a property other than your own. Of course you cannot do that.
Check that your name(s) are spelled correctly. There may well be more than one Jim Smith in your town, and is your name really Jim, or is it James. Agreements of Purchase and Sale are legal documents. Therefore your “legal” name should appear on all copies. Especially, no nicknames should appear on legal documents, and/or assumed names often taken for granted when a foreign name has been changed when someone arrived from another country, but was never “officially” changed. A “tracking” name must be used on all formal and legal documents.
For both Seller and Buyer, having names spelled correctly can be vital to the closing process, the mortgage arrangements, and discharge documents. You or your lawyer must pass clear title to the Buyer. Both you and your Buyer will have multiple cross-checks processed using the names given on the Agreement of Purchase and Sale.
If you are a non-resident, you are responsible for withholding taxes when you sell residential property, and you are responsible to let the closing attorney know that you are in fact a non-resident. As to the Buyer, he could find himself being liable for your withholding tax, if this topic suddenly surfaces on closing day, or after the fact.
Read every line of any material inserted into your offer forms. Double check every item. If there are any issues you do not understand, ask your Realtor to explain them. Now is the time to tie up loose ends. Do not leave unanswered questions until closing day.
Note that there is a big difference between a deposit and a down payment. A deposit will be required with most offers, or will be required to appear upon the date of the final acceptance and agreement of a sale price. A down payment will be required to be produced at your lawyer’s office shortly before closing. The lawyer will need time for your cheque to clear, and will likely request that you bring a certified cheque. Some offices require a deposit cheque to be certified as well, others not. (Read this article: http://www.carolyne.com/downpayment.html )
If a Buyer gives a deposit cheque and the final negotiations particularly if the offer is conditional and the conditions cannot be met by the Buyer, the Buyer then must allow several weeks for the default paperwork to be processed, and the funds returned to him. The real estate office cannot just release a cheque in the amount of the deposit provided by the Buyer until sufficient time has elapsed to know for certain that the cheque in fact has cleared the Buyer’s bank account. Trust funds are treated very seriously and at one point there was a scam operation in place, whereby a would-be Buyer gave a deposit cheque, uncertified, and the broker put the cheque into the trust account. The transactions never reached final acceptance, and the Buyer demanded the return of his money. The brokers complied, only to learn later in the week that the cheque had been returned as uncashable. Now the broker was out the amount of the cheque. Thus the call for certified funds, and even then, extra time to be certain the funds cleared without restriction.
Releases will need to be signed by all parties to the contract before a real estate office can release those funds that are being held in trust, specific to the subject property listing. Even if the Buyer wants to buy another property listed by the exact same office or agent, the funds, in order to be applied to a different subject property, must have releases signed by all the parties to the original contract. If any party to the contract refuses to sign, the funds cannot and will not be released under any circumstances. Failing receiving these signatures, a judge must decide what happens to a deposit cheque when conditions are not met that should have been fulfilled, having been stated in an offer.
For example: an offer states that the Buyer needs time to complete his financial arrangements. He is turned down by the bank. Therefore his offer becomes null and void, and he will get his deposit back when the appropriate releases are signed. However, he must in fact be able to “prove” that he was turned down by the bank, and not that he just decided after the fact that he no longer wanted your house for whatever reason.
Buyers cannot tie up a Seller’s property regarding arranging financing or a building inspection or a multitude of conditions and then just up and walk away. If the intent was not sincere in the first place, problems will ensue. Buyers need to be forewarned by the selling agent as to the appropriate conditions, wordings, and procedures long before signatures are applied to an offer.
In an ideal world, the Buyer and/or the Buyer’s agent will already have proof in hand, in a written format, saying that the Buyer is in fact not just “qualified”, but pre-approved in writing by whatever financial institution is lending him the mortgage money, and he only needs a few days to sort out the final details, one of which is that the bank must approve your house, as being sold within a ballpark price range as to its worth. The bank will not permit Buyers to pay too much for a house. They simply will not release the mortgage funds if this does happen, and your overpriced house does not appraise.
When there is a clause in the offer that says the balance will be paid on closing day, as the Seller you have the right to ask where that money is coming from. Often times the mortgage information per se is not defined on the paperwork. You don’t need to know actual specifics as to what rate or term or amortization the Buyer has agreed to, but you do need proof that you are not accepting an offer, only to have it disappear after having agreed to a sale price, because what the Buyer thought he was approved for in financing is not correct. You have a right to ask for what is referred to as a “written” commitment. Your agent will instruct you as to the process. Ask. This information is vital to the sale of your property.
Never accept an offer on your property, conditional upon financing being arranged, unless the agents (yours and theirs) can prove up front to you that the condition is only for the “finalizing” of finance arrangements. This should and can be done in just a few days. There is absolutely no need whatsoever in today’s markets, to take your home off the market for ten days or more, regarding a finance condition. Absolutely inappropriate in almost all cases; three to five days is ample. Know that other Buyers will not view your home, typically, when it has an accepted offer in place for financing or inspection and typically there is no escape clause in an offer with these conditions. So, theoretically, you are removing your home from the marketplace while the Buyer figures out what he is finally doing about his finances. Don’t do that. By doing so for an extended period of time, you could put yourself at the risk of an overnight drop in the market, or by missing out on a legitimate Buyer who has all his paperwork already in order, but goes off and buys a neighbour’s house, thinking yours is sold, when it is not finalized yet.
Buyers making their purchase with less than 25% down payment (not deposit), will be required to have government insurance, and CMHC or GE Capitol will have the final say as to whether or not the condition on financing can be removed. They will double-check the credit of the Buyer, and they too will want to know that the Buyer has not overpaid for the property, because they are providing the insurance to cover the mortgage held by the bank. Their thinking is that if the Buyer loses his job or some such catastrophe occurs, and they get the house back, they want to be able to sell it at a reasonable price in a reasonable period of time in a typical marketplace. They want to be certain there is enough leverage based on market conditions prevalent at any point in time. They and the bank will arrange to have an appraisal done on the property to validate the sale price as having been in a range suitable for the community in which the property is located. So you can see to a certain degree, you do not have the final control as to the actual sale price, when your Buyer requires a mortgage.
Rarely do we see a Buyer offering to “assume” your existing mortgage. This is mostly because existing mortgages are mostly non-transferable, currently, and if so, the Buyer needs to qualify in most cases. So, typically the Buyer will want to provide his own financing. If you have a huge discharge fee or penalty tied to your getting out of your existing mortgage, it may be worth discussing your options with your banker, ahead of time, and perhaps some creative arrangements can be made to help you.
Your offer will most likely (and ideally, should) contain a clause that says the offer is conditional upon the Buyer having his own building inspection done. All Buyers should be instructed to insert this clause. It is not only for the protection of the Buyer, but for your protection as well. Any unknown problems (and known ones that have not been disclosed) will come to the service and be identified, along with the suggested appropriate costs for remedies, and then this information can be addressed between the Seller and the Buyer. Occasionally renegotiation must happen to adjust for these situations in order for a Buyer to agree to remove this condition. No Seller should be held ransom at this stage, so in order to stay a step ahead, a Seller is often advised to have a pre-inspection done, so he knows up front what possible problems a Buyer may learn about while having his own inspection done. After having a pre-inspection, the Seller can decide on what he is prepared to account for, or not, based on his asking price. It is so much easier for all concerned when all the pre-paperwork has been done and has been taken into consideration all around.
In recent decades, it has been almost unheard of for a Buyer to ask a Seller to “hold a mortgage”, since bank rates have diminished so much. But occasionally on a difficult to sell property where the owner has extra funds, he may want to hold a mortgage as an investment, and use it as a source of income. Occasionally having the Seller provide financing will produce a higher sale price, but it usually means that the would-be Buyer cannot qualify by regular means to get a mortgage. This is so rare that you will want to involve your attorney and your accountant right up front if this request is made of you. Be absolutely certain not to accept any sort of agreement to sell your property with what is referred to as a Seller take back mortgage without having professionals check on your behalf, as to the goings on. Your livelihood could be at stake. Yes, you can take back your house if the Buyer defaults, but getting him out of your house will never be easy. Better not to get involved in most cases.
Seniors in particular need to beware, as there are scam artists out there in abundance, involved in buying real estate. If you have a friend, neighbour or relative who is a senior and is thinking of selling, advise them strongly to seek the advice of a professional “before” selling their home. It’s often too late, after the fact, to untangle sad situations.
As a Seller you should have thought through ahead of time about what you will and will not leave with the property. Such items as appliances and drapes will be asked for in offers by some Buyers even if they are not showing as being included, on the listing. This is where negotiating comes to the foreground. The offer price is certainly not the only paramount item of discussion during an offer presentation. Many topics affect the final outcome, one being what chattels and fixtures will be agreed to in the final discussions.Whatever is included in the sale, the Buyer will be asked by the attorney just prior to closing to put a dollar value on the items, because he is required to pay provincial sales tax on those items.
It is important to know if there are any outstanding contracts on these items. For example if you bought your appliances at Sears, and they are not fully paid for, you cannot leave them, unless of course you pay them out first. It will most likely be stipulated that the appliances will be in good working order. They must be in working order on the day of closing. If anything happens to them after closing, this is no longer your responsibility. However, if, from the time of sale until closing something happens to them, they are in fact still your responsibility, and you must put them back in working order by arranging to have them repaired or replaced. Ideally you should provide a list of serial numbers and model numbers to your agent, and they should be specified on your contract, as a means of identification to the Buyer.
It is critical in particular if any item is being excluded from the contract, that a Buyer might otherwise come to expect to be included, be marked as an exclusion at the time of the offer presentation. Note these items carefully and initial the exclude list, which will draw the items to the attention of the Buyer because he too will have to initial the changes.
Likewise it is your responsibility to keep your home insured until closing, even if you have left it vacant. Typically this kind of insurance is non-transferable, and the Buyer will have to acquire his own insurance. The world of insurance is currently very volatile. Don’t be surprised if you see a clause in your offer, requiring the Buyer to provide proof that he can get insurance, failing which he will “not” get his mortgage. We are not talking life insurance here, but rather fire insurance. Insurance companies are working to quota and many are not writing new policies due to the number of insured world catastrophes, and many companies are not permitting Buyers who have existing insurance on their current property, to take that policy with them. Many Buyers are unaware of this situation until it befalls them. And, there are many instances where properties cannot be insured at any price. For instance, insurance companies will not insure properties that have knob and tube wiring, insul-brick siding, and a volume of other situations that are un-insurable at this time. Then it also becomes your problem, because your house becomes “unsold” because it cannot close. Ask your Realtor to explain it. Typically Realtors do not sell insurance, so they cannot be pressed into guiding you about how much insurance is appropriate or at what cost. Include an insurance clause permitting time to get something in writing from your insurance agent. It is absolutely not sufficient to say don’t worry about it. It is vital to your closing to have covered as much information as is possible at the time of listing, and supported again at the time of an offer.
If you are selling rural property, or buying rural property, there is a multitude of material that must be inserted in the white space of an Agreement of Purchase Sale. There are rules and regulations regarding rural property contracts that are special to the cause. If the property is a working farm, or just plain old farmland, different rules and regulations apply. Property that is to be subdivided falls into a separate category again. Recreational property has its own set of rules and clauses. Property adjacent to water has special rules and conditions that must be met.
There are clauses regarding wells and water return rates. Clauses are required regarding septic tank services and oil tanks, and whether or not the tanks are inside the house or outside matters. If an oil tank has been removed, an environmental issue must be tackled. Has there been any soil contamination (this can occur even inside the house, because the cement/concrete floor is porous and sits on top of soil). If there is no contamination, can you prove it? You will require special documents regarding all these topics. It is prudent for a Buyer to ask for many special tests and proof. If you are the Seller, do not be offended by these requests. Currently many of these types of requests fall within the law, and you must by law provide the answers to these questions, or hire someone who knows how to ascertain the answers.
Lawyers don’t know all the answers to these types of questions. They do not practice selling real estate out in the field so to speak; out in the trenches. Sometimes a Realtor has more current information. Sign nothing until you are absolutely certain that your rights are being protected, whether you are the Seller or the Buyer. Never feel pressured by the irrevocable date. If a Buyer is serious he will allow you sufficient time to digest the material in the offer, within reason. If there are clauses that contain conditions that must be dealt with there will be time limits involved, and those time limits are critical to the contract. Where requested results and advisories must be provided within the time limits or the contract becomes void. Check what the wording says as regards what happens next. Is there an escape clause? The contract needs to address what happens to that deposit, in each and every condition, on a one by one basis. The clause will also address who is to do what and what happens if the issue is not addressed within the time stipulated.
If there are major changes that require the changes to be made by amendment, if the change is something that must be agreed to by both parties, then an irrevocable date must follow the amendment, requiring those changes to be agreed to within a specific stated date. Sometimes an irrevocable date will even have a time allotted to it. Double check.
You will be asked to provide an existing copy of a survey (this is also called for in the fine print, although the fine print states you will give what you have in your possession). If you don’t have one, you may be required to get a copy, or you may even be requested to provide a new survey. This can be expensive. There is no law that says you must buy one. If a bank requires the Buyer to have one, he may have to buy one himself if you do not agree to provide the survey. This request sometimes must be “negotiated”. Ask your agent to explain it in detail. There is no such legal term “up to date” survey, and this term should “never” appear on an offer. Many court cases have been had over this wording. What does up to date mean? Up to date means “right now”, “immediately”, this minute. Nothing short of this is “up to date”. A survey is only complete and accountable as at the date it is drawn. It is copyrighted by the survey company and technically belongs to them. Survey companies do not want their original surveys being passed from Seller to Buyer, but at the time of writing, it is still permissible to ask and receive the existing survey with the passing of title. In the near future, this may not be so.
You will be asked to validate if there are any rental items associated with your property, and if so, is it permissible to pass along the rental or lease contract to the Buyer? Does he have to qualify to assume those agreements? He certainly must provide agreement if he is to accept a rental unit (for example, a hot water tank). You must declare that you either own the tank or rent it. If you say you own it and you in reality rent it, you could find yourself liable for paying a sum equal to the rental life of the unit, as an adjustment on closing, if the Buyer decides to use this against you. Check it out. Could be costly otherwise. Better to ere on the side of saying it is a rental, and the Buyer finds out after the fact he owns it. Some furnaces have been replaced by rental units. It is vital to disclose this information to your Buyer. No, you cannot remove the humidifier from the furnace, or the built-in air cleaner. They are attached and stay with your furnace equipment.
Speaking of equipment: It is not a good idea to sell central vacuum systems that are installed and include “related equipment”, a pool and “related equipment”, etc. as this leaves so much room for misunderstanding. Use the example where a Buyer is sure he saw a beater bar in the closet with the central vac unit, but you have never owned one. Your contract calls for “all related equipment”. Now what do you do on closing when your attorney gets a letter from the Buyer’s lawyer demanding that you return it, but you never even had a beater bar. How can you prove it? Now you must pay your lawyer to do extra correspondence. All this could have and should have been made clear on your offer.
You will note that a resale home price includes GST, but a new home purchase does not. Read the fine print carefully, to be sure the agent has not accidentally misrepresented this on your offer. You will be responsible.
Speaking of taxes, double check your listing if you are a Seller, to be certain your taxes have not been expressed as a yearly amount on your listing when in fact the amount is a half yearly amount or some other “portion”. If the amount is misrepresented to a Buyer, someone, likely your Realtor, will have to pay up the difference. Someone will have to take responsibility for the error. This error happens very often, and someone has to pay. It is likely that the Buyer’s attorney will catch this mistake and make you and your lawyer aware how much extra you have to adjust for the Buyer’s advantage.
There is an item called Title Search, on your offer. This typically refers to the time the lawyers have to pass required documents back and forth between both sides. The Buyer’s lawyer will requisition these documents from the Seller’s lawyer, and the Seller’s lawyer needs time to prepare and do the required work. Double-check the date, that the right year is noted, and that the date is a date “prior” to the closing date. You don’t want someone picking at finite details, if they have decided they want out of the deal. You don’t want to supply them with cause.
You will want to have prearranged with your bank or other financial institution as to what will happen with your own existing mortgage if you have one. It is your responsibility to make sure if there are any discharge penalties or fees, that you know what they are. Depending on your equity, and whether you require your full equity to make your next purchase, a large discharge fee or penalty could severely “cramp your style” when you discover all your equity has been eaten up by the penalty. Now what?
You must be in a position to give clear title to the Buyer. Even if you paid off your mortgage ages ago, you need to be sure that the payout is “registered” on title that it is paid in full. Otherwise your sale cannot close on the called for closing date. There may be six or more transactions all waiting to close, and because no one can prove that you did in fact pay off your mortgage, it could put all the transactions end on end, in jeopardy. Costs will be incurred, sometimes major costs. Know that you, personally, could be held liable for all the costs of all the other people involved in the mess created by this situation.
There will be “adjustments” due on closing, based on a per diem basis. As an example, if your taxes are paid for the full year, and you sell at the half year point, you are entitled to a half-year rebate from the Buyer at closing. Likewise, hydro bills, gas bills, oil tank fill-ups, water bills, and any other utility costs will be adjusted at the time of closing. Typically your lawyer will calculate these items. This is just meant as a heads up piece of information, because you may not have a whole lot of time to think about it at your final meeting before title passes to the new owner. You may be required to provide copies of oil contracts and such, so that your lawyer can do the required work.
Locally, a husband, wife or otherwise spouse, cannot legally surrender title to a residential property without the signature of the other, subject to court documents that state otherwise. Even if the spouse is not “officially” on title, if the property is a matrimonial home, under the Family Law Act, the spouse will be required to sign the documents in the appropriate allocated signature space, unless other arrangements and proof of such arrangements are in place.
Note that any written or typewritten material added to the fine print original document, supercedes the fine print, and is considered to be the legally agreed to information. Do not write on the contract anything that is not pertinent to the contract. You must not doodle on the contract. Anything you write on the contract takes precedence. Make certain that you initial “every” change to the document, no matter how small. Count the changes. Count the initials, and then re-count them. All copies should be exactly the same as one another. Usually there is at least one change or initial that goes astray. And wouldn’t you guess, that is the copy that ends up in the other lawyer’s hands when someone decides they don’t want to close. Have you given them a reason to walk away and leave you stranded? because you or some agent was “in a hurry” to get on to the next deal?
Know that when you receive an offer on your home, that any, (read “any”) change that you write into the contract, no matter how small it is “voids that contract”. It doesn’t matter how agreeable everyone is. The paper speaks. It has a voice of its own, and it certainly has a language of its own. What it says is what it means, even if what it says is not what “you meant” it to say. It is so important to take the time to check and double check, and then if available, have a fresh pair of eyes check it again. When an offer is presented there is a timetable associated with it during which time you as the Seller have the Buyer’s permission to accept it or reject it, with or without changes. Some Buyers like to come in at a low initial offer price because they like to “bargain”. Others choose a price point and tell the Seller to “take it or leave it”.
An agent who is a good negotiator will sit down, goes over the finite details with you, and spend as much time as you require to decide whether you want to accept it, reject it, or make changes to the offer. The time frame allowed is called an “irrevocable date”, and that is also a legal term that must be complied with. You “must” work within the time structure noted on the contract. When you make any changes, depending on circumstances, you may want to change the irrevocable date to the following day or some other date; again make sure all the copies match one another. The would-be Buyer then has the same opportunity based on the new irrevocable date, to do the same. Again every change must be initialled by each party to the contract. Each contract must be evaluated based on its own circumstances. Nothing about a contract is cut and dried except the legal requirements that make it a contract.
If, per chance, you agree on all the information in your contract, and you have sold your property, and then on closing day the Buyer fails to appear, for any number of reasons, legal or otherwise, you may think that you get to keep his deposit cheque monies due to the default. No, you cannot “keep the deposit” and neither does the Buyer get it back right away. No one will be in receipt of those funds, failing getting releases signed by all parties to the contract.
Your agent is not a party to the contract. Neither is the agent acting for the other side. If the Buyer refuses to let you keep the deposit, the real estate company is, by law, not permitted to release the funds. The deposit funds then must be paid into court, and will sit there until a judge decides who is entitled to the deposit, based on why the transaction did not close. There are multiple reasons why closings do not complete. Some do not complete on closing, but come together and finally close at a later date. Some do not close at all. Then the courts are involved, and witnesses called and the proceedings can get very very costly for all concerned. This is one more reason to dot your i’s and cross your t’s originally, when you have all the time in the world to check, check again, and then check one more time.
Ask as many questions as you want. There is no time restriction and there are no dumb questions. The only dumb questions are the ones that don’t get asked. Sometimes people feel uncomfortable asking questions. Don’t ever put yourself in that position. Just don’t. Too much depends on the validity of your contract. If you don’t understand, simply say you do not understand. If you don’t know how to word your questions, call for a “time out”, and ask to speak privately with one another and/or privately with your own agent. By all means, if you feel more comfortable letting your lawyer look at the documents first, tell everyone to go home while you seek the advice of your lawyer. However, be forewarned. Don’t ask you lawyer for an opinion as to how much he thinks you should take for your house or how much you should pay for your new house. He is not a practicing Realtor, and likely is not privy to local market prices, and even if he is, it is not part of his job description to instruct you in this regard. You will seek advice from your attorney as to the legitimate use of terms and word construction, so that you are not in jeopardy when you buy or sell.
*This material is copyrighted by Carolyne Realty Corp. and may not be reprinted without permission in writing.
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