Trying to sell house...buyers backing out.

[LadyBeBop]

Thanks for all of your responses thus far.

1) I thought they said freon. Maybe it's radon. Yes, they do have a basement. However the levels detected was better than the national average. So that shouldn't be a reason to back out of it. Even if the levels were not good, my in-laws still should have had the option of fixing the problem.

2) They signed the contract about three weeks ago. There was a clause in the contract that states they had to vacate by May 31. That's two and a half weeks from today. So they had to be packing.

In Tennessee, the seller hands over the keys to the buyer upon close. I've never heard of anything like that. In Kentucky and Ohio, the seller is allowed 30 days to vacate. Stuff happens right before the close.

This happened ten years ago. I think there's more examination of buyer's credit now. However, while selling our last house, the bank did a last minute check on the potential buyer of our house. They contacted their employer and found that he was termininated weeks earlier. The sale fell through less than 12 hours before close. At least we didn't have everything packed up. Took us another two months before we sold the hours...for $10K less.

 

[EMode]

Thanks for all of your responses thus far.

1) I thought they said freon. Maybe it's radon. Yes, they do have a basement. However the levels detected was better than the national average. So that shouldn't be a reason to back out of it. Even if the levels were not good, my in-laws still should have had the option of fixing the problem.

2) They signed the contract about three weeks ago. There was a clause in the contract that states they had to vacate by May 31. That's two and a half weeks from today. So they had to be packing.

In Tennessee, the seller hands over the keys to the buyer upon close. I've never heard of anything like that. In Kentucky and Ohio, the seller is allowed 30 days to vacate. Stuff happens right before the close.

This happened ten years ago. I think there's more examination of buyer's credit now. However, while selling our last house, the bank did a last minute check on the potential buyer of our house. They contacted their employer and found that he was termininated weeks earlier. The sale fell through less than 12 hours before close. At least we didn't have everything packed up. Took us another two months before we sold the hours...for $10K less.

Radon is a carcinogen and it really doesn't matter what the national average is, all that matters is the level measured in the home. Radon is a very good reason to back out of a sale, and while the seller could put in an abatement system that doesn't mean it is a requirement for a buyer to still buy the house if the seller does.

 

[crisi]

And, it doesn't make any difference. They can back out at any time prior to closing for any reason and only lose earnest money.

 

[OrangeBirdFan]

It's going to depend on what's in the contract and how your state interprets the contract. If your parents were using an experienced realtor, I'd see what the realtor says regarding remedies before consulting with a lawyer; if your realtor can point to a clause and say the buyer is getting under this contingency and you can follow what the realtor is saying, you've just saved yourselves a consultation.

Your parents MIGHT be able to keep the earnest money. They MIGHT be able to go after the buyer/buyers for damages exceeding the earnest money, but the costs of doing so would likely be prohibitive. They aren't going to be able to make the buyers buy the house. Their options are going to depend on the contact (and to some extent the area).

We're actually in the process of buying a home in Virginia and I know that we could have walked away with a clean home inspection. We would have had to share the report with the sellers, but that was it. The report did not have to include any issues at all. We had a separate contingency for radon and for our approval of the home owner's association documents. Friends in similiar situations have had contingencies for a number of things. It all depends on what was in the contract.

The fact that your parents have begun packing/sold some furniture doesn't necessarily mean that all contingencies have been removed. For our place, we removed all contingencies about 3 weeks prior to closing. With my friend's purchase, they didn't remove the contingencies until 1 day prior to closing because the seller forgot to provide the HOA documents! Everything worked out, but the seller was in the position where he had to pack and get everything ready to vacate while there was still the possibility of the sale not going through. Had the sale not gone through, the seller wouldn't have even been able to keep the earnest money.

 

[supersnoop]

1) I thought they said freon. Maybe it's radon. Yes, they do have a basement. However the levels detected was better than the national average.

The national average is irrelevant. What's the threshold to "pass" the test?

2) They signed the contract about three weeks ago. There was a clause in the contract that states they had to vacate by May 31. That's two and a half weeks from today.

Again, that's irrelevant. What's the expiration date for the inspection contingency?

 

[Grace&Carolinesmom]

Just a few thoughts...

A lot has to do with the details of the contract and the wording of the contingencies as written in by the realtor. If the seller had the right to cure the defects found in the inspection contingencies, it does give the buyers less ability to use it as a reason to cancel the contract. It depends again, however, on how it is written and whether the buyer or seller chooses the terms to cure the defect.(meaning who chooses the company to fix the issues, their credentials, what constitutes the defect as cured, etc)

If this was an all cash deal meaning there was no financing contingency, it will really be important to go over the exact wording of that inspection contingency. It may very well be that the buyers are within their rights to cancel and get their earnest money back. If the contingency was written with the seller's having rights to cure and are within the time frame for curing, the sellers will be more likely in the right and will keep the earnest money.

 

[JanaDee]

Buyers can back out at any time in the process. No one can ever be forced to purchase a home they don't want.

The only thing they may lose is their earnest money, but if the offer has contingencies written into it, they may get their earnest money back.

What your inlaws have done with their personal effects is irrelevant.

 

[dragonfly57005]

Jana Dee is right.

Best hope is to be able to keep the earnest money. That's the best they can hope for.

 

[tvguy]

From what we know in this thread, this doesn't seem to be true.

If the buyer can't substantiate a reason for backing out the seller keeps the money. Gas tests have pass and fail levels. National averages might not mean a lot, are there regional levels? Recommended levels? If they are saying no based on an inspection item they would have to disclose the item to be able to get their money back.

I think Emode made my point. If detectable levels of a carcinogen aren't a valid reason to cancel a sale and get a full refund of your deposit, something is wrong.

Radon is a carcinogen and it really doesn't matter what the national average is, all that matters is the level measured in the home. Radon is a very good reason to back out of a sale, and while the seller could put in an abatement system that doesn't mean it is a requirement for a buyer to still buy the house if the seller does.

 

[tvguy]

In Tennessee, the seller hands over the keys to the buyer upon close. I've never heard of anything like that. In Kentucky and Ohio, the seller is allowed 30 days to vacate. .

Must be a Tennessee thing. Here in California, you have to be out for a sale to close. I sold my mom's house, and the title company had to wait until I called and said the recycling company had come and removed the washer, dryer and refrigerator before they could close. I called at 1:45 pm, sale was closed at recorded at 1:50 pm, the money was in my bank account at 2 pm

Now, you can rent back. When we bought our house, the owners needed a week to get out after close of escrow. The had to pay me 1/30th of my house payment (which included homeowners insurance) for every day they stayed.

 

[Minnesota!]

Must be a Tennessee thing. Here in California, you have to be out for a sale to close. I sold my mom's house, and the title company had to wait until I called and said the recycling company had come and removed the washer, dryer and refrigerator before they could close. I called at 1:45 pm, sale was closed at recorded at 1:50 pm, the money was in my bank account at 2 pm

Now, you can rent back. When we bought our house, the owners needed a week to get out after close of escrow. The had to pay me 1/30th of my house payment (which included homeowners insurance) for every day they stayed.

That's how it is in MN, too (the same way it is in CA).

 

[Mickeyluver37]

Must be a Tennessee thing. Here in California, you have to be out for a sale to close. I sold my mom's house, and the title company had to wait until I called and said the recycling company had come and removed the washer, dryer and refrigerator before they could close. I called at 1:45 pm, sale was closed at recorded at 1:50 pm, the money was in my bank account at 2 pm

Now, you can rent back. When we bought our house, the owners needed a week to get out after close of escrow. The had to pay me 1/30th of my house payment (which included homeowners insurance) for every day they stayed.

Here it's typical to do a "walk through" with the buyer and their realtor the night before, then the keys are handed over at closing, paper work signed, checks exchanged, etc. Rent backs are possible, but not the normal process.

It's also typical here for all appliances to convey. It wasn't until I started reading the DIS that I realized other states did it any differently.

I've also never heard anyone that WASN'T from California use the term "in escrow." Here, we say a house is "under contract."

 

[mistysue]

I think Emode made my point. If detectable levels of a carcinogen aren't a valid reason to cancel a sale and get a full refund of your deposit, something is wrong.

But this particular carcinogen is naturally occurring and is EVERYWHERE- not just in the home. There also has to be a realistic approach. The national indoor average is about 1/3 of the level where the EPA suggests you do anything. It is possible that the outdoor levels are radon for that area are as high as they are in the home.

 

[rachael95]

Everything depends on how their contract was written. You can add or delete anything in a contract.

Typically in TN, the sellers should be out of the house and you do a walk-through the day of closing. If the sellers need more time to leave, they can rent the house for however long they need (as long as the new owners agree). But they literally have a rental agreement to do that.

If your parents were not using a realtor and this was just a cash deal with everything verbal, they're out of luck.

If they have a realtor, then have their agent look at the contract and see if the people have at least forfeited the earnest money. If the radon inspection really was bad, then I believe the buyer has the option to either cancel or allow the home owners to fix it. It's a bit difficult to fix radon though since it's a gas that comes up from the ground. It's not like a leaky pipe you can repair.

 

[EMode]

But this particular carcinogen is naturally occurring and is EVERYWHERE- not just in the home. There also has to be a realistic approach. The national indoor average is about 1/3 of the level where the EPA suggests you do anything. It is possible that the outdoor levels are radon for that area are as high as they are in the home.

I thought this was interesting because I had never really looked at the outdoor levels versus the indoor.

http://www.radon.com/radon/radon_levels.html

What is a safe level of radon gas?
This is the simpler of the two questions. A safe level of radon gas is no radon gas. Radon gas is a carcinogen which causes lung cancer. The US EPA has put it plainly, stating, "Any radon exposure has some risk of causing lung cancer. The lower the radon level in your home, the lower your family's risk of lung cancer." The average person receives a higher dose of radiation from the radon levels in their home than from their combined exposure to all other radiation sources, natural or man-made. Radon gas is a naturally-occurring byproduct of the radioactive decay of Uranium in the soil. Depending on your geographic location, the radon levels of the air you breathe outside of your home may be as high as 0.75 pCi/L. The national average of outside radon levels is 0.4 pCi/L and it is estimated by the National Academy of Sciences that outdoor radon levels cause approximately 800 of the 21,000 radon induced lung cancer deaths in the US each year. Your risk of lung cancer increases substantially with exposure to higher radon levels. Lung cancer risk rises 16% per 2.7 pCi/L increase in radon exposure. (World Health Organization, 2009) Studies show that radon is the primary cause of lung cancer among people who have never smoked. However, the absolute numbers of radon-induced lung cancers are much larger in people who smoke, or who have smoked in the past, due to a strong combined effect of smoking and radon.

 

[barkley]

Here it's typical to do a "walk through" with the buyer and their realtor the night before, then the keys are handed over at closing, paper work signed, checks exchanged, etc. Rent backs are possible, but not the normal process.

It's also typical here for all appliances to convey. It wasn't until I started reading the DIS that I realized other states did it any differently.

I've also never heard anyone that WASN'T from California use the term "in escrow." Here, we say a house is "under contract."

we used 'under contract' here and in California as well, but with both they were still 'in escrow' b/c that was where the earnest monies are held until the closing is complete (and in some situations there may be some monies withheld in escrow for a period of time after closing if an issue doesn't hamper closing but will have a financial consequence for non compliance by a designated date after the sale).

 

[OrangeCountyCommuter]

Thanks for all of your responses thus far.

1) I thought they said freon. Maybe it's radon. Yes, they do have a basement. However the levels detected was better than the national average. So that shouldn't be a reason to back out of it. Even if the levels were not good, my in-laws still should have had the option of fixing the problem.

2) They signed the contract about three weeks ago. There was a clause in the contract that states they had to vacate by May 31. That's two and a half weeks from today. So they had to be packing.

In Tennessee, the seller hands over the keys to the buyer upon close. I've never heard of anything like that. In Kentucky and Ohio, the seller is allowed 30 days to vacate. Stuff happens right before the close.

This happened ten years ago. I think there's more examination of buyer's credit now. However, while selling our last house, the bank did a last minute check on the potential buyer of our house. They contacted their employer and found that he was termininated weeks earlier. The sale fell through less than 12 hours before close. At least we didn't have everything packed up. Took us another two months before we sold the hours...for $10K less.

Having sold and purchased houses in Tennessee and Georgia I would NEVER agree to buy a house that you got to keep for 30 days after closing. My money my house, the sellers don't get to stay. I have always inspected AFTER move out before final closing also. I would really have to trust you any other way and when I sold I had to be out the night before so the buyers could do a final walkthrough to make sure I left house in condition promised.

OP's family needs to be getting advice from their realtor. However, considering the two offers etc.. I think that perhaps they are trying to save the fee and do this themselves?

 

[tvguy]

But this particular carcinogen is naturally occurring and is EVERYWHERE- not just in the home. There also has to be a realistic approach. The national indoor average is about 1/3 of the level where the EPA suggests you do anything. It is possible that the outdoor levels are radon for that area are as high as they are in the home.

I think some might argue that termites and black mold are naturally occurring too, but both can be legal basis to cancel a purchase and get a refund of your deposit.

 

[hlg22]

I wonder how the radon contingency in the contract is worded...when I bought my house, the radon contingency expired automatically by a set date unless the buyer (me) provided a copy of a report indicating radon levels had been found that met or exceeded the EPA threshhold plus either (1) an addendum requesting that the seller fix the radon issue or (2) notice voiding the contract. Thus radon levels below the EPA threshhold would not have been a legitimate ground for voiding the contract, and would not have allowed me to get my earnest money deposit back.

By contrast, the home inspection contingency just provided that I had to give the seller a copy of the inspection and either an addendum requesting repairs or notice voiding the contract - even if there was not a thing wrong with the house, I still had the right to cancel the contract post-inspection.

 

[OrangeCountyCommuter]

I wonder how the radon contingency in the contract is worded...when I bought my house, the radon contingency expired automatically by a set date unless the buyer (me) provided a copy of a report indicating radon levels had been found that met or exceeded the EPA threshhold plus either (1) an addendum requesting that the seller fix the radon issue or (2) notice voiding the contract. Thus radon levels below the EPA threshhold would not have been a legitimate ground for voiding the contract, and would not have allowed me to get my earnest money deposit back.

By contrast, the home inspection contingency just provided that I had to give the seller a copy of the inspection and either an addendum requesting repairs or notice voiding the contract - even if there was not a thing wrong with the house, I still had the right to cancel the contract post-inspection.

This whole mess is why I wonder if there is a good Realtor involved. Because if there is then these issues are addressed in the contract and all OPs family has to do is read the contract and say "we get to keep X" or not.

I nearly backed out of the purchase of my current house over an issue that the owner originally refused to fix. Based on the contract I knew there was NO risk of me losing any money. (Actually I think one of the reasons she did fix the issue was the fact that her realtor pointed out to her that she got nothing if I walked and she had already made an offer on her new home)