Contract wording in the sale of home

[mrmrsflweb]

I drew up a contract for sale by owner. in the contract, I worded it that the buyer would pay all customary charges, title insurance,appraisal, pest inspection, etc. The wording was written for a conventional loan. The buyer has gotten an approval for a FHA loan, and the lender sent us a letter that would raise the price of the sale of the home, so that it reflected the charges of the closing costs required for the seller to pay in a FHA loan were covered. my question is, if we don't sign that letter saying we agree to raise the sale price to cover these closing costs, will that void the contract legally?
I have a reason to prolong the closing of this house, that i plan on asking in another area of the real estate board.
thank you so much
mrmrsflweb

 

[HomeGuru]

I drew up a contract for sale by owner. in the contract, I worded it that the buyer would pay all customary charges, title insurance,appraisal, pest inspection, etc. The wording was written for a conventional loan. The buyer has gotten an approval for a FHA loan, and the lender sent us a letter that would raise the price of the sale of the home, so that it reflected the charges of the closing costs required for the seller to pay in a FHA loan were covered. my question is, if we don't sign that letter saying we agree to raise the sale price to cover these closing costs, will that void the contract legally?
I have a reason to prolong the closing of this house, that i plan on asking in another area of the real estate board.
thank you so much
mrmrsflweb

**A: if you do not agree to the FHA conditions, you have no sale. You are taking a big risk acting as your own attorney.

 

[mrmrsflweb]

thanks, home guru......i never worded in the contract that it was a conventional loan, but it conveyed it, i think, by saying buyer would pay all customary charges. is that correct?..i know that i really need to consult an attorney, i talked to one tody, but he was so brash. he said , "well, if you don't sign it, they can't close. so, maybe they'll get an attorney to force you to close."

 

[HomeGuru]

thanks, home guru......i never worded in the contract that it was a conventional loan, but it conveyed it, i think, by saying buyer would pay all customary charges. is that correct?..i know that i really need to consult an attorney, i talked to one tody, but he was so brash. he said , "well, if you don't sign it, they can't close. so, maybe they'll get an attorney to force you to close."

**A: the contract is worded too loosely. Customary charges could be a lot of things or just half of the usual Seller closing costs in your area. Depending on the FHA loan program, it may be customary for the Seller to pay for repairs, etc. If it was a VA loan, it could be customary on 100% financing for the Seller to pay for repairs and even the Buyer's loan points. What does customary mean anyway?
What if I'm the Buyer and I'm in the military and bought all my homes using my VA and every time the Seller paid for closing costs and points. That certainly would be customary for me to have the Seller pay for everything. Your contract provision is vague, open to misunderstanding and there is no meeting of the minds.
So you see, you did not fully protect yourself.
By the way, that brash attorney you talked to is also an idiot. If your contract will be changed due to FHA requirements and the sales price increased, that is a counter offer that you are not obligated to accept.
But like I stated earlier, if you do not accept, it's no deal. Ask yourself if you can find another Buyer at the same net price.