• FreeAdvice has a new Terms of Service and Privacy Policy, effective May 25, 2018.
    By continuing to use this site, you are consenting to our Terms of Service and use of cookies.

Agents mistake on closing costs

Accident - Bankruptcy - Criminal Law / DUI - Business - Consumer - Employment - Family - Immigration - Real Estate - Tax - Traffic - Wills   Please click a topic or scroll down for more.

G

geo111

Guest
What is the name of your state? Pennsylvania

Our buyers agent came to our house with an offer. The prospective buyers made an offer asking us to pay 100% of their closing costs. To offset this, they said that we could raise the selling price of our house to incluse those closing costs.

Initially I was inclined to do just that, raise the selling price as necessary. My wife and I were unsure on this though. Our buyers agent recomended against raising the selling price as she felt that our house might not appraise for the higher value.

Please note that we have always intended to use the proceeds from the sale of our house to pay for as much of the closing costs of the next house as possible.

I asked our agent how the offer would affect our purchase of the new house . The agent did not have her folder with the details on the contract. After some serching, my wife found our copy of the folder.

Using the contract from our copy of the folder, our agent worked up a "Statement of Estimated Sellers Costs" She applied the estimated proceeds against the closing costs for the new property. The difference she gave us was about $1900.00. My wife and I decided that we could accept the offer without needing to raise the selling price of our house.

A few days after we accepted the offer our agent called and told us that a mistake was made and that our closing costs would be $2,000.00 higher. When she generated the figures for us, on the 22nd, she used the old, unrevised contract that had the sellers giving us $2,000.00 buyers assistance. The current version had that option removed.

Our agent told us that our folder had the incorrect information and that was why the $2000.00 error occured.

My wife looked at our copy of the folder and found both copies of the contract inside. Apparently, when our agent worked up the figures for us on the 22nd, she used the incorrect version of the contract.

My wife and I are not happy. We feel that this mistake should not have happened. Had we been given the correct figures for our closing costs we may not have chosen to accept the offer on our house as we had.

As everything stands now, we will have enough money to pay the new, much higher closing costs but thats about it. We wont have enough cash to buy the washer and dryer that we'll need nor will we be able to pay cash for any moving expenses.

It is our opinion that our buyers agent should have have had her copy of the new property folder when she came to present the offer on our current home. She knew that we were using the proceeds from the sale of our house to offset, as much as possible, the closing costs of the new property. She should have known that she would need that data to help us make an informed decision concerning the offer.

As the Real Estate professional, our agent should have known that she was using the incorrect version of the contract. Had she caught that, she could have looked a little deeper in our folder and found the correct version of the contract.

My wife and I feel that either our agent or the agency that employs her should make up for the two thousand dollar error, not us. They are the real estate professionals that we are paying to help us make these transactions. The error was on thier part, not ours.

Any advise would be greatly appreciated.
 


Souix

Senior Member
Your post is long and very very confusing, so forgive me if I am getting my facts screwed up.

Why can't you just renegotiate? In otherwords, ask the buyers of your house to raise the price on your home by whatever the closing costs are and you ask the sellers of your purchase to raise the price to cover your closing costs. In addition, when my clients make this arrangement to pay the buyer's closing costs by raising the sale price by that amount, I always only charge the seller on the net price, I do not charge a percentage for the closing costs too. Its not much but every little bit counts.

Also, when your agent is preparing your net sheets, there should be a disclaimer, because no net sheet is exactly right. Prorates on taxes and insurance are figured in at closing based on whatever the closing date is. Thats why its called an estimated statement. You also should have read the amounts on the estimated statement, and by accepting the amounts as correct, without double checking, you are partially to blame also.
 
G

geo111

Guest
Tshanks for replying Souix.

I apologize for my long post.

Why should I have to renegotiate? Our buyers agent forgot to bring all of the information she needed to properly present the offer to me.

She used our copy of the folder which contained a correct version and an incorrect version of our contract wth the seller. If she had used the correct version of that contract, we would not be having this problem.

I'll take a closer look at the net sheets. I'm sure there are disclaimers and I understand that some of the figures are approximated. However, this $2,000 error was a mistake on her part. How can we be partially responsible for trusting her to know what she is doing?

Ok, I've looked at the net sheets. The one the explains the Buyers costs says that it is an approximate. However, this document also reflects our original offer and lists the $2,000 sellers assistance, which was later dropped from the offer. We do not have a newer, updated sheet listing the buyers costs.
 
Last edited:

JETX

Senior Member
I think it is important to point out something that is missing in your post. Though the real estate agent is largely responsible for most of the transaction, YOU still have an obligation to read and understand the details. if you don't understand, you have an obligation to ask. You cannot simply just sign everything that is put in front of you.... without assuming at lease some responsibility for the contents.
 

HomeGuru

Senior Member
I agree with JETX and also add that the writer should have a meeting with the principal broker and see what they (the brokerage company) will do to help.
Possibly buy a new washer and dryer, pay $1000 or reduce their real estate commission.
 

Souix

Senior Member
geo111 said:
Tshanks for replying Souix.

I apologize for my long post.

Why should I have to renegotiate? Our buyers agent forgot to bring all of the information she needed to properly present the offer to me.

**Why not? It seems that might be the thing to do to keep things on an even keel. By your refusing to do so, may put red flags up for your realtor and the principal broker that you are of a litigious mindframe. I do not think, you realtor should have to chip in $2,.000. It seems like an honest mistake and you also have the obligation to double check figures. When you buy other big ticket items, don't you double check the figures automatically?
It sounds to me like you were both negligent. I think it would be in your best interest to try to work something out with everyone involved. Good luck!
 
G

geo111

Guest
Thanks to everyone for the replies. I really appreciated them.

I like the options that JETX has listed.

As for seeming litigious, I have no doubt that the Brokerage would sue me if they deemed it necessary. So I am not concerned with their feelings about that.

When I have made other big ticket purchases, I do my research as necessary. I also check my figures and recheck them. However, with this purchase, I have employed a Real Estate professional to act as my Buyers Agent. I'd like to think that the commission that I am paying was for something other than a listing.

In real life, I repair and install aircraft electronic equipment. If I make a mistake, I am responsible. I dont ask the customer to share that with me. I'd think that other professions would have similar feelings about responsibility.

My wife and I will discuss our options this evening. Again, I want to thank everyone for helping us with this. I'll post whatever happens with this issue. If anyone has anymore thoughts, I'll check this thread a couple of times per day.

If any of you have questions about aircraft radios, I would be glad to help.
 

HomeGuru

Senior Member
I have an aircraft question in general. You know the non-destructive material that they make those black boxes with; why can't they make the whole plane with it?
 
G

geo111

Guest
The Flight Data and Cockpit Voice Recorders are pretty tough boxes. They are also pretty heavy.

It all comes down to money. The stronger aircraft are made, the heavier they become. Heavier aircraft have a lower payload and bring in less income.

btw, we had a sit down conversation with our buyers agent and her boss. We laid out all of our information, after much discussion, they opted to cover the $2,000.00 error.
 
G

geo111

Guest
Whats is an E&O deductable?

I agree that they were generous. The conversation was much more amicable than I expected.

It didn't hurt that we had a copy of a message from our answering machine that helped our position.

At this point my wife and I feel pretty stupid though. If we had done our job and read the paperwork more carefully, this situation would not have come up.

Home Guru, Souix and JETX; My wife and I want to thank you again for your advice. In situations like this, it can be very difficult to get an objective perspective. Your advice helped us to moderate our expectations.
 

Find the Right Lawyer for Your Legal Issue!

Fast, Free, and Confidential
data-ad-format="auto">
Top