AboutDennis Herman Expertise I can answer questions on Real Estate such as question on writing an Offer to Purchase. What can go wrong after an offer is written? What is Buyer Agency and what will it do for me? What is a foreclosure? What is the difference between a foreclosure, a bank owned property and a short sale? What is the best way to locate a property? What steps can be taken to avoid foreclosure? How do Real Estate Agents get paid? How can I quickly build equity in a home? How do I view homes? What types of homes will have the best prices? How do I choose an agent? What types of financing are available?
Experience Residential and commercial real estate. New home purchases. Buyer Agency. First time home buyers. Foreclosures, bank owned properties, estate sales and short sales.
Organizations Greater Milwaukee Realtors Association
Wisconsin Realtors Association
National Association of Realtors
Publications http://activerain.com/bloghome
Education/Credentials State of Wisconsin Licensed Real Estate Sales Agent
Accredited Buyer Agency Training
Relocation Training
Certified Senior Citizen Representative
Wisconsin Real Estate Continuing Education
Question I made a bid on a house on April 1st and the bid I made changed the sale from a regular sale to a short sale. We offered them $10,000 less than what is owed on the property. They are not in foreclosure yet. We signed an addendum to the bid about the bank having to approve the sale and also allowing other people to bid at the same time. We put an answer date of April 17th (even though we knew it could take months, we wanted to be able to start looking for other houses). I wrote a check for $500 as a good faith deposit. The 17th came and went so we began looking for other houses. The seller's agent cashed my check on April 30th. At first my agent was on my side telling me they aren't allowed to do that. However, now she is telling me that after talking with the seller's agent, she has realized that they are allowed because we signed an agreement. I don't feel this is right. how are they allowed to cash my check weeks after the date we asked for a response. I understand that we didn't formally withdraw our bid, but that shouldn't matter. They cashed my check and at the same time are allowed to except offers from other people. The real estate I am buying is in PA. Any information you could give me would be appreciated. I need to know my rights, especially when I feel that my own agent messed up royaly and is now trying to cover it up!
Answer I am licensed to sell real estate in Wisconsin. I can tell you how things should be handled here and you can check with your local agent.
First of all, do you have a Buyer Agency Agreement with your agent? In WI all agents represent the seller unless you enter into an agreement with the broker. This is a special provision available in WI.
You may also call the Broker or office manager to find out what your options are in PA.
They did the correct thing in having you sign an addendum stating the property is a short sale. It is standard practice to put down earnest money once an offer is accepted. It is also standard practice to deposit the check. In WI the money is held in a special trust account monitored by the state.
I do not understand why your agent allowed the sellers to continue to market the property. In WI a signed Offer to Purchase is a legal binding contract. There are provisions for continued marketing but the seller can not accept another offer without first releasing you. They can accept secondary offers, but you will still be in the primary position as long as you satisfy all of your contingencies within the specified time frames.
To formally withdraw your offer and have your earnest money returned you will have to execute a Cancellation Mutual Release. There should be a provision for distribution of the earnest money. If the seller will not sign a Cancellation Mutual Release you will either have to go through with the purchase or hire an attorney to make a decision. The attorney will look at the contract to see if anyone has failed to comply with the terms of the contract.
Now this may or may not be the case. In WI the Short Sale Addendum allows for a time limit. This states how long you are willing to wait for third party approval. The standard Short Sale Addendum in Wisconsin states, "Buyer may cancel this contract by supplying written Notice to the Seller within 5 days of the above date. If Buyer fails to supply written Notice, it is deemed the Buyer has waived this contingency" In other words, if you did not notify the Seller of your intent to cancel the contract within the specified time limit, you now will have to wait until the third party approves or disapproves the sale. If that is the case you may want to talk to an attorney for find out what your options are under the contract.
Very interesting question and yes this does happen to others.
