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Misrepresentation???

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pattyd_2002

Guest
What is the name of your state? Maine

I have been house shopping for over a year now. I finally found a house I liked that I could afford. The asking price was $95,000 as is. After my offer of $88,000 was accepted, I was told this was to be a short sale contingent upon Rural Development accepting the sale, my contract stated the seller was to pay 3 points for closing. The appraisal came back at $97,000, and I gave specific instructions that it was not to be shared with anyone other than my mortgage co. Anyway this turned into a nightmare!! First, the title clerk at the attorneys office (which was supposed to represent my best interests) shared my appraisal with Rural Development. Once they saw the appraisal they would not accept anything less than $97,000. The same day I found out there was a lein on the house for $$4,600, and the seller did not have the money to pay his lein or the points towards closing. Is there any recourse for me???? :confused:
 


HUD-1

Member
Rural Development would never approve a short sale without reviewing the appraisal. Your contract was subject to their approval and they did not approve it. Contract is void. They MAY have paid some points if it were reasonable and customary. They MAY also have paid off the lien. If you want the house, you can increase your offer and see what happens. Most likely, RD is required to sell near the appraised value on a short sale. (P.S. When you stated that your offer was accepted, does this mean the seller signed a contract without the RD approval language?)
 
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pattyd_2002

Guest
Rural Development??

First of all YES the seller signed the contract!! what I do not understand is, The seller or his broker should have been responsible for an appraisal prior to putting this house on the market right?? Should the Title Clerk should have asked our permission prior to sharing the appraisal?? Who would put a first stage repo home on the market without getting a real selling price? I feel like these people have been trying to take me for a ride. What do you think??
 

HomeGuru

Senior Member
Re: Rural Development??

pattyd_2002 said:
First of all YES the seller signed the contract!! what I do not understand is, The seller or his broker should have been responsible for an appraisal prior to putting this house on the market right??

**A: No. In most cases, the Buyer orders and pays for ths appraisal because it is part of the mortgage process.
***********



Should the Title Clerk should have asked our permission prior to sharing the appraisal??

**A: no because of the contingency.
**********


Who would put a first stage repo home on the market without getting a real selling price?

**A: many do.
***********



I feel like these people have been trying to take me for a ride. What do you think??

**A: I disagree.
 

HUD-1

Member
It doesn't appear that there is anything malicious going on here. They were just trying to put together a sale to get the owner out from under the debt from the property. They originally put in on the market for $95,000 which is very close to its appraised value. Your offer was apparently the best offer at $88,000, and they presented it to RD.

If the seller signed the contract without the language requiring RD approval, than that was an error, but I don't see a remedy for that. They have no ability to sell the property at that price. If you attempted legal action, I would assume that they would walk away and the property would go into foreclosure.

If you still want the property, raise your offer, if the RD can pay points, trim them to 2 or less, have the seller look into a short payoff of the lien and perhaps see if the listing agent will trim their commission. Good luck!
 
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pattyd_2002

Guest
Seller

Thank you for your advice. When the seller signed the contract which stated the Seller will pay 3 points, doesn't that bind him to that?? Rural development will not pay any points and the lein will also not be covered by RD.

It is not unethical on the part of the realtor, not to disclose any of this info to me prior to binding us to a contract? :confused:
 

HUD-1

Member
If the seller had the $ for three points, he/she would probably bring the loan current. If the seller signed the contract without the RD language, then they were in error, but you can't get blood from a stone. What would your remedy be?
You might get a judgment, but it would be very difficult to collect on it.

Re: the agent, what did they know and when did they know it?
 
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pattyd_2002

Guest
The agent

The agent knew from the beginning. From what I was recently told, the seller is a good friend of this agent, and the agent put the house on the market as a favor. My biggest issue is that the agent knew about the RD short sale before putting the house on the market. The agent never disclosed the info until after my deposit was taken. The seller owes over 96,000 on the house plus the lein. The appraisal does not deduct for the heating system needing to be replaced or the fact that the seller pulled the wallpaper off the walls and broke 3 windows because he was angry because his house was being reposessed.

I think I should back out of this deal. What do you think?? :(
 

HomeGuru

Senior Member
Re: The agent

pattyd_2002 said:
The agent knew from the beginning. From what I was recently told, the seller is a good friend of this agent, and the agent put the house on the market as a favor. My biggest issue is that the agent knew about the RD short sale before putting the house on the market. The agent never disclosed the info until after my deposit was taken. The seller owes over 96,000 on the house plus the lein. The appraisal does not deduct for the heating system needing to be replaced or the fact that the seller pulled the wallpaper off the walls and broke 3 windows because he was angry because his house was being reposessed.

I think I should back out of this deal. What do you think?? :(

**A: what? There never was a deal because RD will not approve the sale period.
Even if they did, this transaction has too many problems. Keep looking for another home.
 
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pattyd_2002

Guest
Thank you. Spoke with realtor, she asked me to pay the lein and get no points, plus pay 96,000 and change. No way. I am signing the release this afternoon.

I will find a house eventually. Everything happens for a reason, Right??

Thanks for the info....:)
 

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