Can I back out and not loose my deposit?

[illermay26]

What is the name of your state? CA

We put a bid for a house for $389,000 (asking price) and it was accepted. The house was just appraised and only appraised for $380,000. We want to back now because we feel that the house is not worth what we expected. Accoriding to the purchase agreement we signed when we put the bid, it says:

"This agreement is contingent upon the property appraising at no less than the specified purchase price. If there is a loan contingency, at the time the loan contingency is removed, buyer shall remove the appraisal contingency or cancel this agreement."

Doesn't that mean we can back out? Our agent is saying no. Please help.

[HomeGuru]

Originally posted by illermay26
What is the name of your state? CA

We put a bid for a house for $389,000 (asking price) and it was accepted. The house was just appraised and only appraised for $380,000. We want to back now because we feel that the house is not worth what we expected. Accoriding to the purchase agreement we signed when we put the bid, it says:

"This agreement is contingent upon the property appraising at no less than the specified purchase price. If there is a loan contingency, at the time the loan contingency is removed, buyer shall remove the appraisal contingency or cancel this agreement."

Doesn't that mean we can back out? Our agent is saying no. Please help.

**A: at first hand it appears that you can terminate but read the entire contract.
Is your real esate agent an idiot? Why is your agent saying that you can not back out? Please post the specifc language in your contract that supports your agent's position.

[JETX]

I agree.

[HomeGuru]

Thank you.

[illermay26]

My agent is saying that the appraisal contingency means that the seller can back out if they wanted to not the buyer. I keep explaining that is says buyer but she won't budge. I don't know how more clear the paragrah can get.

[HomeGuru]

Originally posted by illermay26
My agent is saying that the appraisal contingency means that the seller can back out if they wanted to not the buyer. I keep explaining that is says buyer but she won't budge. I don't know how more clear the paragrah can get.

**A: I don't give a rat's ass what your agent said. Can you follow simple directions? Read my first post again.

"This agreement is contingent upon the property appraising at no less than the specified purchase price.

Common sense dictates that this phrase protects the buyer...

[HomeGuru]

Originally posted by coosi
"This agreement is contingent upon the property appraising at no less than the specified purchase price.

Common sense dictates that this phrase protects the buyer...

**A: yes but there could be and should be other contingencies in the contract dealing with the appraisal and the financing issue. Furthermore, the writer should request an interpretation and explanation from the agent's principal broker. If the agent wrote the contract language as posted, the agent is surely an idiot.

[illermay26]

My agent is not stating any language in my contract that supports her position. She is just telling me that I am reading the paragraph (the one I put in my first post) wrong.

[HomeGuru]

Originally posted by illermay26
My agent is not stating any language in my contract that supports her position. She is just telling me that I am reading the paragraph (the one I put in my first post) wrong.

**A: Hint: maybe you should demand that she and her principal broker show you the clause in your CONTRACT that supports her position. Ok, I'll explain further. You are free to quote me by telling her, "Listen agent, I don't give a (freakin- [optional word]) rat's ass what your opinion is. Get your principal broker to explain it correctly before I hire an attorney to do so "

[JETX]

Does your agreement provide ANY other references to the appraisal contingency??

If not, then the clause, "This agreement is contingent upon the property appraising at no less than the specified purchase price.", is not party-specific and could be used by either party. Clearly the contract writer screwed up in not clarifying either a percentage of acceptance and which party (if only one) that this clause applies to.

So, your next question is.... who 'wrote' the contract??? The ambiguity would be found against the writer (or writers agent).

Now, lets look at the REALITY of this situation. Appraisals are NOT exact, nor do they necessarily represent a property's true value. In this case, the difference between purchase price and appraisal is LESS than THREE PERCENT!!!
You are simply 'splitting hairs'. If the property was worth $389k to you when you made your offer, why is it not now worth that amount??? What has happened to the property to make it lose that 2.3% in your opinion??

Have your realtor, or another independent realtor, provide neighborhood 'comps' on the property. You will very likely find that this is simply an 'emotional' issue and that the house is worth the purchase price.

[illermay26]

I saw 2 houses in the area that are pretty similar and are selling/sold for $355-369k. That is why we think that the house is not worth it anymore.

[JETX]

Originally posted by illermay26
I saw 2 houses in the area that are pretty similar and are selling/sold for $355-369k. That is why we think that the house is not worth it anymore.

That simply doesn't make any sense.
If you honestly felt that the property wasn't worth it, why the hell did you make the offer of $389k??? This is clearly a case of 'buyers remorse'!!
Get another appraisal.

[HomeGuru]

I agree with the Buyer's remorse but disagree with getting another appraisal.
My opinion would be to terminate the contract.

[illermay26]

Thanks for your help!