Selling, how to cancel the deal? - Posted by George

import · November 12, 2006, 2:07pm

Posted by JT-IN on November 13, 2006 at 19:10:05:

The original question was whether the court would require the seller to sell under order of a “specific performance”…?

I said doubtful that they would force someone to sell, instead they might levy damages… in terms of dollars and cents… The fact that a property is not so unique that it cannot be replaced by another… Most houses aren’t exactly something that you can’t find another one suitable to the buyer… but at a cost, and inconvenience of time and expense… Hence, the money damages, as you stated, Not forcing the homeowner to convey the property.

The other factor is that it costs money and time and risk of loss to file suit… Your average homeowner wannabe isn’t able, or willing to endure such distress… they would move on and find another house first, with rare exception. The agents owed commissions is another story… The seller can plan on paying that, for sure.

JT-IN

import · November 12, 2006, 2:07pm

Selling, how to cancel the deal? - Posted by George

Posted by George on November 12, 2006 at 15:07:05:

After signing the contract to sell, I learned that we need to stay in the
area
several years longer–work related reasons. Buyers really want the
house, the
price is about 5% under market, but no one knows for sure where the
market is
these days…
Is there a way I could get out of the contract? What are my options? I
was on the
other side once where buyers defaulted, but I did return the deposit.
What does
usually happen if seller defaults?

import · November 13, 2006, 6:44pm

Why? - Posted by Joe

Posted by Joe on November 13, 2006 at 19:44:56:

At 5% below FMV, in a declining buyer’s market, AND when you were already preparing to move out … Why wouldn’t you sell? Sure, transaction costs would eat up a little bit, but what’s your market’s outlook for the next couple years? Unless your market wasn’t affected by the bubble … where are you located?

import · November 12, 2006, 5:28pm

Re: Selling, how to cancel the deal? - Posted by gerald(tx)

Posted by gerald(tx) on November 12, 2006 at 18:28:28:

Work related reasons?

This could be an out, depending on your state laws, just as some states are quite liberal on breaking a lease if your job transfers you.

Even so, ‘work related’ kind of sounds like a ‘druther’ rather than something mandatory. Is this correct?

gerald

import · November 12, 2006, 4:06pm

Re: Selling, how to cancel the deal? - Posted by Sailor

Posted by Sailor on November 12, 2006 at 17:06:02:

If there is an agent involved, you’ll probably be responsible for the
commission, even w/out a sale. Recommend you consult w/your
attny, pronto, but remember that often a face-to-face chat w/a
reasonable explanation often does wonders. If all else fails, look
@ this as an opportunity to make some lemonade.

Tye

import · November 12, 2006, 2:55pm

Re: Selling, how to cancel the deal? - Posted by Jack

Posted by Jack on November 12, 2006 at 15:55:56:

You can be sued for specific performance of the contract if it gets to that point. You could offer to give him back the deposit or if you read the contract carefully, it may have some other out. Or as a last resort you could offer him some additional money, if you want to go that far.

import · November 13, 2006, 6:57pm

Re: Why? - Posted by George

Posted by George on November 13, 2006 at 19:57:52:

We are still in a stable market in Jacksonville Beach, FL. At the top of
market in Summer of 2005 the house would have sold for 10% more.
Invesntories are gradually increasing but sellers are in denial of a
bubble and will not lower the price much. I do believe in a slagish year
or two, but also believe that I sold for the bottom price. You can see
the pcis of the our ultra modern house at http://recorderworld.com
sold in three weeks.

import · November 12, 2006, 5:32pm

Re: Selling, how to cancel the deal? - Posted by George

Posted by George on November 12, 2006 at 18:32:36:

Yes, agent is involved, so I guess I am stuck, ha…

import · November 12, 2006, 3:24pm

Re: Selling, how to cancel the deal? - Posted by George

Posted by George on November 12, 2006 at 16:24:06:

I had no intention on keeping the deposit anyway. I was going to also
pay for buyers expenses already incurred. They call me every week,
sometimes more often, to make sure we are closing–they really want
the house and probably think they are getting it for about 10% less
than the market based on ASKING prices in the area. What is the
outcome if I get sued for specific performance and why is it if buyer
defaults, the only recourse seller gets is keeping the deposit, but if
seller defaults than he gets sued?

import · November 12, 2006, 10:15pm

Re: Selling, how to cancel the deal? - Posted by Sailor

Posted by Sailor on November 12, 2006 at 23:15:56:

Let’s see, kid, so you are stuck w/a motivated buyer in a buyer’s
mkt, & your worst case scenario is that you are going to be a
buyer in that same mkt? Not every cloud has a silver lining, but
you could be a very lucky guy–

Tye

import · November 12, 2006, 8:11pm

Stuck to this extent… - Posted by JT-IN

Posted by JT-IN on November 12, 2006 at 21:11:18:

You can plan on paying the commission, at the very least. If you read the purch & sale agreement, it will say something to the effect that: Agent has earned a comm when they have delivered to seller, a ready willing and able purchaser. They have apparently done so, unless some problem would develop with an inspection, appraisal or the purchasers mtg loan process.

If there are still unresolved contingencies, such as an insp clause, you could refuse to perform any of the identified deficiencies. Possibly the buyer will walk away, based on your refusal to make requested repairs…

They cannot make you sell. The agents can force you pay a comm, or obtain a judgment against you if you don’t. The purchaser could possibly obtain damages against you, for expenses… but less certain than the comm by agents. They cannot and will not force you to convey your property, but they may legally require you to provide a reimbursement of damages to purchaser, if they take it to mat…

Good luck on it…

JT-IN

import · November 12, 2006, 4:59pm

Re: Selling, how to cancel the deal? - Posted by Kristine-CAq

Posted by Kristine-CAq on November 12, 2006 at 17:59:03:

Read your contract. It usually states what the liability is for each party.
If you used a Realtor board contract, in most places it is extremely
pro-buyer, not pro-seller.

I would talk to the buyers and tell them the reason you cannot sell at
this time and that you would like to cancel the contract. Let them
come back with what they want to do. If I were them, knowing what I
know (but what the buyer’s probably don’t) I would ask you for
payment to cancel the contract.

What I wouldn’t do is spend another minute thinking/guessing what
the sellers are thinking. Doesn’t matter if they think they are getting a
deal on the asking price vs. the FMV. What matters is that you signed
and they signed in good faith and now you are the party that wants to
change the contract for your benefit. If it were me I’d put it out there
to them asap that you cannot sell and see where the negotiations take
you. Kristine

import · November 12, 2006, 11:11pm

Re: Selling, how to cancel the deal? - Posted by Tom

Posted by Tom on November 13, 2006 at 24:11:11:

What is with all of the kid stuff?

import · November 13, 2006, 12:40pm

Re: Stuck to this extent… - Posted by Natalie-VA

Posted by Natalie-VA on November 13, 2006 at 13:40:18:

JT,

Don’t you think the Buyers could file a specific performance lawsuit and that the court might MAKE him sell it?

–Natalie

import · November 13, 2006, 6:32am

Re: Selling, how to cancel the deal? - Posted by Sailor

Posted by Sailor on November 13, 2006 at 07:32:49:

That’s what my grandmother called all her friends. As I am a great-grandmother twice over, I do the same. Age of the kidee has nothing to do w/this term of endearment. I call Rocket Man kid, too, & he is 71.

If anyone is sensitive to the term, get over it, kid–

Tye

import · November 13, 2006, 1:29pm

Yes, I think they could file a suit - Posted by JT-IN

Posted by JT-IN on November 13, 2006 at 14:29:53:

No, I do not think that most buyers WOULD file a suit… They would bluster and threaten a suit, but not follow through in the long run. The filing of lawsuits are expensive, time consuming and emotionally draining.

Not that it can not be done, not that a court or judge would not rule in the favor of a purchaser… but it is just as likely that it can be resolved financially, except in the case of those properties are so unique that reasonable money damages are inadequate…

What is just as important here is whether the property is replaceable or completely unique to any other. If one were to file a spec perf suit on a tract house, when there are 100 others just like it in the neighborhood, it is unlikely, IMO, that any court would order the seller to convey the land. Those circumstances fit that of money damages more so than a spec perf of a contract… it is NOT completely unique and irreplaceable…

You typically see spec perf used more in that of business properties, rather than residential… At the end of the day, the buyer was looking for a house when they found this one… and how badly are they damaged, if the seller decides not to sell…? Inconvenienced,…? certainly, but not too badly damaged.

So I say in most cases residential buyers would not spend the time, the money or inconvenience to pursue this type of thing… and risk that they may lose the case. The other thing that a buyer must maintain all throughout the suit, is the ability to be a ready, willing and able purchaser… With the average buyer who must obtain financing, this may or may not be practicle…

What is a lead-pipe-cinch in this case is, the RE agents will be paid a commission. They have earned it and will surely be awarded their due, if it came down to a legal question.

“Specific performance of a contract is ordered when the legal remedy, usually money damages, is deemed to be either inadequate or impracticable. When land is the subject matter of the agreement, the legal remedy is assumed to be inadequate, since each parcel of land is unique; thus, equitable jurisdiction in this case is firmly established.”

Just the way that I view things…

JT-IN

import · November 13, 2006, 8:16am

Re: Selling, how to cancel the deal? - Posted by Tom

Posted by Tom on November 13, 2006 at 09:16:09:

Ok mom.

import · November 13, 2006, 6:36am

LOL!! - Posted by Lyal

Posted by Lyal on November 13, 2006 at 07:36:28:

nt

import · November 13, 2006, 4:29pm

Re: Yes, I think they could file a suit - Posted by Sailor

Posted by Sailor on November 13, 2006 at 17:29:38:

My insurance agent just won a 45K judgment against a seller who
backed out. I just heard today that one of my sellers wants to
cancel, but I am hanging in there even though his agent is a friend
& isn’t going to hold him liable for the commission. No threats
yet, just trying to baby him through a bad case of seller’s
remorse. However, I have a recent precedent in this county & no
fear of filing if we can’t work things out.

Tye