Backing out on the purchase of a home [Archive] - Beyond.ca - Car Forums

jensv

12-25-2010, 11:51 AM

Yesterday my mother announced that she had purchased a home in Calgary. The transaction was initiated and completed over the course of one day and she did not attempt to do any kind of research, consult the family, negotiate price, have the house inspected, (70+ years old!) or generally do any of the things a homebuyer should do to protect themselves.

The sales contract has been signed, a cheque for the deposit has been made, (but not cashed in so we can stop the payment at the risk of being sued) and if things go south (wouldn't be surprised the way this was handled; the house suffers from hail damage, the roof is known to leak and needs repairs, and who knows what else) my mother would have shot herself in her own foot.

Is there any way for buyer to back out of a purchase without losing the deposit? (something like the 72-hour escape clause) What are the options at this point? Is ignorance or stupidity a valid excuse? Should I consider seeking an attorney/lawyer who is familiar with Alberta real estate law? Hope everyone is having a better Christmas than I am.

sr20s14zenki

12-25-2010, 11:58 AM

I know that you have 14 days to back out of contracts...not sure if this applys?

max_boost

12-25-2010, 12:14 PM

What the heck. Is she 70 years old too and losing her mind.

BigMass

12-25-2010, 12:23 PM

What kind of slimy real estate agent wouldn’t advise her to do those things before buying it? I’d go postal on them.

Muji

12-25-2010, 12:26 PM

Email Jordan Lotoski, he is a regular on Beyond. There has to be a cooling off period, I bet she can opt out of the deal if she desires. On the other hand, why should anyone consult with family, etc? It is her money, if she is sane, she can do as she wishes. Frankly, anyone sticking their nose in my business would have it chopped off right quick.

I would too be concerned if I were you, but then again she is an adult and free to act as she wishes. Maybe she did not "consult" you as she did not want your opinion. My parents never ask for my permission to do or buy anything, and why should they? It kind of hurts when the item they buy I happen to be well educated in, so it goes. Last year my father came home with a $280,000 motor home, what are you going to do? Yes they are spending their money on what I consider foolish things that need to be maintained 9$$$).... but I am not going to mention it. Their money, they worked for it and they are not taking it with them when they die.

dawerks

12-25-2010, 12:41 PM

You can back out.

You lose your deposit, and risk being sued (if it was a normal deal).

But what contract doesn't have a) pending financing and b) inspection?

You will be able to back out without losing your deposit and the realtor who wrote up the deal will have to have a chat with his manager and the real estate board. Shady.

guessboi

12-25-2010, 02:02 PM

Did she have a realtor to consult with her??? :dunno:

D. Dub

12-25-2010, 02:28 PM

Consult a real estate lawyer -- they are the only ones who will really know their beans.

barmanjay

12-25-2010, 03:25 PM

Had she been drinking?

in contract law,.. it would be void had she been under the influence

Supa Dexta

12-25-2010, 04:03 PM

How does that work? No proof needed? Just say I was drinking and get out of any contract you want? Seems greasy.

anschutz_92

12-25-2010, 04:26 PM

Originally posted by Supa Dexta
How does that work? No proof needed? Just say I was drinking and get out of any contract you want? Seems greasy.

The fact that she likely drove to the home means that this defense wouldn't go far.

I would try talking to the other party involved and work out an agreement. A lawyer is just going to cost more money. It's not a smart move to involve lawyers if you can walk away from this only a few thousand in the hole.

J-hop

12-25-2010, 06:19 PM

Originally posted by Muji

I would too be concerned if I were you, but then again she is an adult and free to act as she wishes. Maybe she did not "consult" you as she did not want your opinion. My parents never ask for my permission to do or buy anything, and why should they? It kind of hurts when the item they buy I happen to be well educated in, so it goes. Last year my father came home with a $280,000 motor home, what are you going to do? Yes they are spending their money on what I consider foolish things that need to be maintained 9$$$).... but I am not going to mention it. Their money, they worked for it and they are not taking it with them when they die.

The problem with this mentality is, when someone in your family fucks up, makes a stupid purchase, can't afford it, who do they usually fall back on?? thats right, family...

My dad would never spend 300,000 on a motorhome (in fact we both verbal people with motorhomes pretty bad for their idiocy) but if he did i wouldn't think twice about pointing out his indiscretion. Sometimes you just need that sober second opinion to make you realize the implications of your decisions. Whether you can afford it or not is not always the main issue, and sometimes people are so blinded by their want to satisfy some personal agenda that they don't realize what effect it may have on them or people around them

Scope951

12-25-2010, 06:25 PM

Originally posted by Muji
Email Jordan Lotoski, he is a regular on Beyond. There has to be a cooling off period, I bet she can opt out of the deal if she desires. On the other hand, why should anyone consult with family, etc? It is her money, if she is sane, she can do as she wishes. Frankly, anyone sticking their nose in my business would have it chopped off right quick.

I would too be concerned if I were you, but then again she is an adult and free to act as she wishes. Maybe she did not "consult" you as she did not want your opinion. My parents never ask for my permission to do or buy anything, and why should they? It kind of hurts when the item they buy I happen to be well educated in, so it goes. Last year my father came home with a $280,000 motor home, what are you going to do? Yes they are spending their money on what I consider foolish things that need to be maintained 9$$$).... but I am not going to mention it. Their money, they worked for it and they are not taking it with them when they die.

LOL dude the lady bought a house without following any guidelines whatsoever. This is a house not a mobile home.

Call for a free consultation for a realty lawyer, they will provide you with more concrete options

dawerks

12-25-2010, 06:38 PM

You won't need a lawyer, this is pretty clear case of unethical realtor behavior. But maybe your mom is happy with the house? Have you talked to her about it?

It seems like the same realtor was working for the buyer and seller, and they have a clear set of guidelines they have to follow, that obviously were not.

D. Dub

12-25-2010, 06:57 PM

Originally posted by dawerks
You won't need a lawyer, this is pretty clear case of unethical realtor behavior. But maybe your mom is happy with the house? Have you talked to her about it?

It seems like the same realtor was working for the buyer and seller, and they have a clear set of guidelines they have to follow, that obviously were not.

Age does not necessarily make you into a bumbling buffoon.

Mom would have to be "proven" incompetent to consequently prove the realtor unethical.

Deals are done all the time at asking price without home inspections.

jensv

12-25-2010, 07:28 PM

Strictly speaking it's not my money, not my problem, and none of my business, except it is.

My mom is the kind of person who clips coupons to save 50 cents. Now she is putting her life savings on an impulse purchase which was poorly executed and thought out. All those pennies pinched over the years could be gone just like that! Financial issues aside we are pretty dysfunctional, and stuff like this stretches the fragile family fabric thin.

From 2-4?am this morning and much of yesterday evening the family has been fighting over this purchase. I've spent the remainder of this day looking for ways to clean up this mess and I am way over my head. This is not the way I imagined spending Christmas.

The whole situation is ridiculous. I would laugh if it wasn't so painful.

barmanjay

12-25-2010, 07:28 PM

If the contract is accepted (signed, dated and witnessed) by both parties. It's pretty solid.
As long as:

The selling agent had given the agency relationship guide and explained the agency relationship she was going to have with the selling agent; also had 'mom' sign a 'customer status declaration form. There is nothing that can be really done.
The selling agent doesn't have to suggest 'mom' should be represented, but at least explained the legal relationship she was entering.
'mom' would be deemed competent unless proven otherwise.
Even at 70, she's competent.

thetransporter

12-25-2010, 08:03 PM

Dont let the "70+ years old" home always be an issue, there are nurmerous posts on this board with problems with brand new homes and their quality.

xxviet

12-25-2010, 09:15 PM

Oh same situation happened to my mom, she didnt want the house anymore and backed out with out a deposit, my neighbor threatened to sue her for 35k for loss funds.

Went to court paid lawyer 5k, judge ruled to pay him 5k...the 5k he got back he used to pay his lawyer...

silly neighbors i tell ya.

J-hop

12-25-2010, 09:49 PM

Originally posted by xxviet
Oh same situation happened to my mom, she didnt want the house anymore and backed out with out a deposit, my neighbor threatened to sue her for 35k for loss funds.

Went to court paid lawyer 5k, judge ruled to pay him 5k...the 5k he got back he used to pay his lawyer...

silly neighbors i tell ya.

on that same note though, people have to be accountable. For most a house is a HUGE investment, so what if you neighbors had been looking at buying a house conditionally if they sold their current house. Your mom puts an offer on the house, they buy the house they had been looking at, then your mom backs out and they are up shit creek??

Not fair for either party in that case, and I am glad they took your mom to court.

houses aren't something you can buy on a whim and return a few days later because you decided you didn't like the color. But apparently there are a lot of clueless people that like to create messy situations by flip flopping over a huge investment they can't seem to take seriously.

Originally posted by thetransporter
Dont let the "70+ years old" home always be an issue, there are nurmerous posts on this board with problems with brand new homes and their quality.

yea great point. to be honest I find it weird that people think newer homes are built to higher standards, when from what i've seen it is the exact opposite, the build quality in some of the new areas is the absolute pits because they are trying to turn out as many units as possible and focusing on quantity over quality.

thetransporter

12-27-2010, 02:08 PM

Originally posted by J-hop

on that same note though, people have to be accountable. For most a house is a HUGE investment, so what if you neighbors had been looking at buying a house conditionally if they sold their current house. Your mom puts an offer on the house, they buy the house they had been looking at, then your mom backs out and they are up shit creek??

Not fair for either party in that case, and I am glad they took your mom to court.

houses aren't something you can buy on a whim and return a few days later because you decided you didn't like the color. But apparently there are a lot of clueless people that like to create messy situations by flip flopping over a huge investment they can't seem to take seriously.

yea great point. to be honest I find it weird that people think newer homes are built to higher standards, when from what i've seen it is the exact opposite, the build quality in some of the new areas is the absolute pits because they are trying to turn out as many units as possible and focusing on quantity over quality.

great point to you made.

My sister spent thousands on kicthen cabinets , taking her 60 year old ones out (nothing were wrong with them) the new MDF ones would barely hold anything, always would break (just gentle use) she hardly put anything in them, (within 30 days) she ending up having them removed and refunded because there were too many problems. She hired a 60+ year old guy to do it right, he used real wood, did a good job and it actually cost HALF the price. 5 years later she had zero problems.

J-hop

12-27-2010, 02:30 PM

yea its crazy how bad contractors and the materials they use have gotten, its tough to find the older guys (that are still working) who really take pride in their work.

For example we had a major renovation done on our house a few years ago, we had numerous extensions done on the house. one of the extensions has actually started to separate from the house (you can see a huge crack in the ceiling. Also they did a box out on our dining room and when the inspector came around he showed us how bad the work was. Some of the supports were not even bearing load so as a result the box out has sagged slightly (they did come back to try to fix it as best they could but I guess it was just the bare minimum to pass inspection)

We had a large extension done on our living room as well and the bozo contractor couldn't figure out how to route the heating properly so in the winter it was ice cold walking over the extension (also didn't insulate it properly). So my dad ended up paying another company to come in an insulate it properly and he himself rigged up a fan system to increase the flow of hot air to the extension.

Although I won't name this contractor, they were a major one in our neighborhood and we had heard nothing but good reviews. They did do an excellent job on the major part (which was the addition of a garage), but when it came to the smaller projects their quality of work just flopped.

They were also 30% over budget in the end, and in the last 4 months of the reno they had a max of two people working on the house at a time so it took an insane amount of time to finish.

I think with contracting it is really experience that dictates how good you are, someone that has been in the business 60+ years knows what materials to use, knows who to go to, to get them, knows exactly how much its going to cost you and generally does better work (yes I know this is not always the case and there are the odd rookie contractors that take pride in their work). We ended up employing one of my dad's friends to do our cabin instead of wasting time with a contractor, he did take slightly longer (because it was just him and one other guy), but the work is absolutely top notch.

jensv

12-29-2010, 05:09 PM

Update for those who might be curious: Contacted the realtor and requested that the contract be amended to allow for a home inspection. The sellers refused and the realtor returned the deposit. However my mother would like to continue with the original unconditional offer so the house is sold. If hindsight proves that this was a mistake then she really has no one to blame but herself.

Thanks for all the input. (even it it was just to insult my mom..... ) She probably deserves it. ;)

Cos

12-29-2010, 05:17 PM

^^ if I was the guy selling the house I would not accept any further offers from your mom. Just saying she probably burned that bridge.

What person/realtor puts in an offer with no clause for financing and inspection. This isnt 2006/2007 where you get out bid.

barmanjay

12-29-2010, 05:51 PM

Originally posted by jensv
Update for those who might be curious: Contacted the realtor and requested that the contract be amended to allow for a home inspection. The sellers refused and the realtor returned the deposit. However my mother would like to continue with the original unconditional offer so the house is sold. If hindsight proves that this was a mistake then she really has no one to blame but herself.

Thanks for all the input. (even it it was just to insult my mom..... ) She probably deserves it. ;)

So what happened?

Did the contract get quashed?

xxviet

12-29-2010, 06:37 PM

Originally posted by J-hop

on that same note though, people have to be accountable. For most a house is a HUGE investment, so what if you neighbors had been looking at buying a house conditionally if they sold their current house. Your mom puts an offer on the house, they buy the house they had been looking at, then your mom backs out and they are up shit creek??

Not fair for either party in that case, and I am glad they took your mom to court.

houses aren't something you can buy on a whim and return a few days later because you decided you didn't like the color. But apparently there are a lot of clueless people that like to create messy situations by flip flopping over a huge investment they can't seem to take seriously.

yea great point. to be honest I find it weird that people think newer homes are built to higher standards, when from what i've seen it is the exact opposite, the build quality in some of the new areas is the absolute pits because they are trying to turn out as many units as possible and focusing on quantity over quality.

Well his house was listed for a year and the price he wanted for it was outrageous

msouther

12-29-2010, 07:49 PM

"What person/realtor puts in an offer with no clause for financing and inspection."

It wouldn't be something I would recommend all of the time, but if you do your homework first then it can work out just fine. If you have already pre-approved your buyer client before you go out shopping, the financing condition isn't really needed. If the buyer brings along a home inspector during a showing or a contractor friend, then a home inspection isn't necessarily required either. Writing an unconditional offer isn't common today, but if it is done you can usually get a better price for the property.

Again, I would always recommend using both conditions so that you cover your bases and make a sound investment. Home inspection clauses are basically a get out of jail free card anyways though, because it is pretty easy to find deficiencies in a property exceeding 1%. Just be careful because if you use this as a condition and don't waive it. Be prepared to present a copy of the inspection report. The other agent should most likely be requesting this (I always do).

ExtraSlow

12-29-2010, 07:53 PM

My last home purchase was unconditional. I feel it gave me a stronger bargaining position. or I should say it gave Jordan a stronger bargaining position. He/We got a lot knocked off the list price, and I feel the unconditional offer was a factor.

Although, that tactic isn't for everyone.

masoncgy

12-29-2010, 09:19 PM

Home inspectors, for the most part, are useless anyway. I've gone through the process on three separate occassions and they never catch everything they should. You always end up finding something they missed, often items which are significant.

Case in point, I purchased out of province and had to trust a home inspector to go through this place thoroughly... and a few days after I moved in, I uncovered water damage behind the tub from water seeping over time from a small gap in the caulking where the shower door meets the tub & tile surround. Now I get the pleasure of tearing my bathroom apart... nice eh?

eblend

12-29-2010, 09:33 PM

Originally posted by masoncgy
Home inspectors, for the most part, are useless anyway. I've gone through the process on three separate occassions and they never catch everything they should. You always end up finding something they missed, often items which are significant.

Case in point, I purchased out of province and had to trust a home inspector to go through this place thoroughly... and a few days after I moved in, I uncovered water damage behind the tub from water seeping over time from a small gap in the caulking where the shower door meets the tub & tile surround. Now I get the pleasure of tearing my bathroom apart... nice eh?

should have got a guy who has a heat camera, can track leaks easily. I did a home inspection, and the heat camera images is what made it worth it, otherwise I can easily tell myself if the tap water is hot or cold haha

masoncgy

12-29-2010, 11:29 PM

^ This was something that was easily noticed without thermal imaging. Discolored baseboards near the shower & slight bubbling in the walls... easy to miss when I did the quick walk thru of the house in person prior to making an offer...

... but easily picked up by a diligent home inspector.

Tsk.

vinc456

12-29-2010, 11:43 PM

Removed.

jensv

12-29-2010, 11:54 PM

Originally posted by barmanjay

So what happened?

Did the contract get quashed?

I don't know the details but we received the deposit cheque so that was the chance to back out. (I assume the sellers would shred the contract because it was already signed) If mom wanted to make another offer it would have to be with another realtor.

Mom decided that the house inspection would not be necessary and to go ahead with the original plan/contract. She had a few days to think/research and that was her informed decision.

^^ if I was the guy selling the house I would not accept any further offers from your mom. Just saying she probably burned that bridge.

Basically mom just gave the deposit back to the realtor. With a bird in hand the sellers would not have likely accepted a new/lower offer.

barmanjay

12-30-2010, 02:14 AM

Glad things worked out

Next time, you know now to consult a real estate pro about the property,.. especially one that is NOT representing the seller/property.

I almost wonder if the listing agent has some personal interest with the property? perhalps interest in the company that reno'd it?

Interesting that the deposit was handed back without question,...

Well as long as your mom is happy! Thats all that counts and as long as she feels that this time she made an informed decision!