Buyer might loose deposit

We're selling a property which is meant to settle early next week.

Buyer has put down a 10 % deposit .

The day after making the deposit and signing an unconditional contract , they contacted the agent in a panic with a bad case of buyers remorse as their broker had told them they shouldn't have made an unconditional offer . Next day they rang again to say all was well and they had found some more money .

They had low balled us and when we said no , had come back with a more reasonable offer which we had accepted mainly because it was unconditional.

Beginning of this week , SWMBO , said we still don't have the transfer docs. She bought an express post envelope as a back up . She actually does most of the work , unlike me who just talks about it ...

Yesterday , the buyers broker and solicitor contacted our RE agent to see if things were still going ahead ..... Our agents been less than impressed with the purchase since their initial panic moment .

So come Monday we'll be contacting our solicitor with instructions to issue a notice to complete ( or whatever's needed ) as soon as we're are legally able . We've had an initial discussion when we were told the buyer was panicking about what we could do to help them in terms of extra time , but any thoughts of any concessions quickly disappeared when our Agent told us one fact about the buyer .

They're a solicitor , and they should ****ing know better !!!!!.

Never had experience with anyone loosing / claiming a deposit ( Personal or acquaintance ) so will be interesting to see how it unwinds .

Anyone else been through the process ?

Cliff

 

They sound like the knight in Monty Python,s defending the bridge despite being chopped apart bit by bit..

Once you take out all the agent's costs and other behind the scenes cost manipulations i just hope that something left once it's finished..good luck..

 

Haven’t talked to agent about fees , but my assumption is that the agent would get their commission which is around 2% .

I assume that would be of the sale price , rather than of the deposit , though need to talk to solicitor if nothing further happens today .

cliff

 

@See Change - The notice to complete gets served 14 odd days after the nominated settlement date (your solicitor can confirm). In essence, they get their EOT albeit with an interest charge (if it's in the contract).

I've kept deposits before, then the buyer resurfaced and paid the same again (if it wasn't a shade more).

Agent is entitled to their commission which will be on the contract value but won't be released until your solicitor provides the direction.

Transfer docs etc should have been issued to you by your solicitor and they should be well on the way to having the settlement letters/statement prepared, seeking directions as to the cheques required and the number of brown paper bags required .

Buyer should have arranged their final inspection (probably for Monday), pruchaser's solicitor should have got their land tax clearance certificate, rates, water reading etc all arranged, final title search (to make sure you haven't whacked on a last minute caveat) etc.

 

As of yesterday the purchaser hadn’t heard from their client for a while , hence them ringing the agent

Cliff

 

That should read the purchasers solicitor hadn’t heard from the purchaser ....

 

And if it cant be sold for the same price you can sue for economic loss (and the agent fee and extra legals etc is a further loss) as well as the net deposit. Actress Toni Collette & her husband copped this issue in a well publicised case.

I have seen several cases. The agents may even relist it for a second sale and you can negotiate a double dip fee that is less than 2 x the normal price.

 

Hopefully , if it comes to it , we might be able to sell it for slightly more .

Cliff

 

What a waste of your time, it's always stressful either buyer or selling..

But come on, buyers remorse after signing the contract? You've got to know by that point what you want and what you're getting yourself into..

 

Latest is they've asked for a 2 week extension . After discussions with our solicitor we've declined to give that .

Tomorrow we will issue a notice to complete . They have two weeks to comply . We've indicated that if they have everything in train ( and have documents or acceptable contacts to confirm that ) but things haven't been finalised we will give an extension at that stage.

Sounds more promising than last week.

Cliff

 

One day later we've had an offer from the buyer asking to withdraw from their purchase in return of an amount of around 1/3 rd of the deposit .

Offer declined.

Cliff

 

Latest

Contacted by a solicitor acting on behalf of buyer ( previously conveyancer )

While previously we were told the buyer ( and their mother ) had a heart problem ( we didn't believe this ) , now it seems they have a mental health issue and had been admitted and are claiming they were not in a fit mental state to sign a contract.

To go further , the process is that after two weeks we apply to the supreme court to claim the deposit and then they have to prove that they have a mental health issue and were legally unable to sign ( interesting concept that they are legally unable to sign , but are working as a solicitor ... ).

Cliff

 

Sounds like the sort of loophole attempt that only solicitors would try?

 

Ohhh damn. I thought there was an additional limb to them throwing the mental health issue on the table. Voiding a contract isnt quite so black and white as mental health = void. That limb is - The other party (ie you) knew about the mental health impairment at the time of the contact or ought to have known...I see more legal costs. And the fact they are a solicitor may be heavily weighted by a court if they were practising at the time of the contract.

The primary basis is a presumption of ability to contract. A blanket rule that allowed voiding for mental health could in fact act adversely for rights of persons with mental health issues as nobody could/would contract with them if they could easily void all contracts by choice.

 

Any solicitor claiming they have mental health issues that reduces their ability to legally sign their contract is also going to risk their ongoing employment. If it is not a genuine situation then i dont think they would want to challenge you in court for the deposit. For him to win, he would then have proved he is not suitable to continue as a solicitor.

 

Doubt that for general employment law. The employer would face wrongful termination actions. Mental health is not unlike a cold. The employee may need time to get well and manage their condition

 

Which state is the property as every state has different laws regarding the default - in Qld they lose the deposit without question IIRC.

 

It has really escalated... looking forward to seeing how this plays out....

 

A void contract action would bypass state law if it were found void by the supreme court.