Post Auction valuation

Discussion in 'Loans & Mortgage Brokers' started by kyawin, 24th Jan, 2018.

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  1. kyawin

    kyawin New Member

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    I recently sold my house by Auction. In Victoria, Contracts of Sale by auction are unconditional, therefore there is no 'subject to finance' or similar clause. By bidding at auction and signing a Contract of Sale buyers are doing so either with the finance available or taking the risk of not getting approval and therefore being in breach of contract.
    I have since had a request to organise a day for a valuer to attend the property in order for the buyers finance to be approved. I have been told that if I refuse, and he does not get the finance by settlement, I am in breach of the Contract of Sale due to me preventing him from obtaining the money.
    My questions:
    1. As it is an unconditional Contract of Sale is it not the buyers responsibility, not mine, to ensure the finances are available by settlement?
    2. Is there any legal requirement for me to allow a valuer to attend the property after the Contract of Sale has been signed?
    3. If the buyer does not get the finance, due to me not allowing the valuation occurring, and is therefore not able to meet the terms of the Contract of Sale, who is in breach, the buyer or me?
     
  2. Trainee

    Trainee Well-Known Member

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    What the prolem with allowing a valuer access?
     
  3. qak

    qak Well-Known Member

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    If you have to take time off work to give access it could be a problem.

    Q4. should be: what if you allow the valuer access and the buyer still does not get the finance?

    Unless something to the contrary is in the contract, I think it's the purchaser's problem. As far as I know, some valuers don't require physical access.

    Having said that - it would be courteous to provide access - can you get the RE agent to do that if it's a problem for you?
     
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  4. Property Twins

    Property Twins Mortgage Brokers & Buyers Agents Business Member

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    Valuation is a normal part of the process with any sale and arranging finance.

    Why would you deny access?
     
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  5. DaveM

    DaveM Well-Known Member

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    So if you deny valuer, and purchaser cannot get finance due to this item only, dont expect the legal side of things to go well for you
     
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  6. MC1

    MC1 Well-Known Member

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    Are you for real!
     
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  7. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    All banks will require a valuation of the property as they are securing the funds against it.
    Read your contract that you agreed to but it is probably outlined in there that you need to grant reasonable access to the Buyer for this.
     
  8. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Val access will take an hour or so max on the basis that the valuer is on time.

    I sometimes have to intervene with vendors and work through common sense in similar scenarios.

    No one wins by looking to work to the letter of the law in scenarios like this

    Suggest you provide the access and get on with it please

    ta

    rolf
     
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  9. Jake Milne

    Jake Milne Well-Known Member

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    As others have said are you able to provide some more context around the reason you're asking this question?
    Intrigues me when someone is being paid hundreds of thousands of dollars for something and things, like mowing a lawn, or opening a locked door are questioned; would love to gain some insight from you :)
     
  10. hobartchic

    hobartchic Well-Known Member

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    Valuer can not access property, buyer can not access finance, and you void your contract and lose the sale? Why would you do that? It's just a matter of opening the house and making some time. It makes sense to me that any valuer would want to see the condition of the property inside as well as out.
     
  11. Phantom

    Phantom Well-Known Member

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    Generally speaking, it is standard procedure for a lender to do a valuation on a security they are lending against. It is at a minimum, common courtesy (there may also be legal obligations to allow reasonable access) to allow a valuer access to a property for the purpose of a valuation.

    That aside, if you have a genuine reason why you cannot give access, you need to convey this to either the valuer or the purchasers solicitor. There may be alternative arrangements made to facilitate the valuation. But, flat out refusing without reasonable grounds will not fly I'm afraid.
     
  12. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    If you don't allow access for a valuation, the purchaser will have a lot of trouble getting finance. No finance means no sale. This is a normal part of the sales and finance process and you should do everything you can to accommodate the valuation.

    With no sale you might then argue that you get to keep their deposit and sell the house to someone else. I'd suggest the purchaser could sue you for actively sabotaging their efforts to complete the contract and it's the seller that is in breach of the contract. I have no idea of the legal basis for this, but you might find yourself without the house anyway and a lot less money as well.
     
  13. luckyone

    luckyone Well-Known Member

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    The agent you sold through should be able to let the valuer into the place for you.
     
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  14. Scott No Mates

    Scott No Mates Well-Known Member

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    Next, you'll want to impede the final/pre-settlement inspection.
     
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  15. Noobieboy

    Noobieboy Well-Known Member

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  16. DaveM

    DaveM Well-Known Member

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    So at a brief glance of the VIC standard form CoS, if the purchaser is in an unconditional auction conditions contract and you force them along to settlement day having refused valuation access, you run up against this

    You are in default of the contract by failing to do all things necessary.

    Also note
    By intentionally delaying the purchaser's ability to get finance, you are in default of the contract


    Lastly as you are in default

    Purchaser can exit contract, be repaid all monies, and recover their losses.

    So, to put it mildly, why would you obstruct the valuation, unless you no longer wish to sell and want to use it as a method to exit an unconditional contract?[
     
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  17. Tim86

    Tim86 Well-Known Member

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    You seem like a terrible person to do business with. Hopefully this is a momentary lack of common sense on your part and not a sign of your general disposition.
     
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  18. kyawin

    kyawin New Member

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    I posted my questions in the hope of receiving answers, not to receive criticism, condemnation or have my character judged by people who don't even know me.
    My reasons for these questions are due to the questionable actions by the agent who sold my property, including a possible conflict of interest with the buyer. Due to multiple breaches of Legislation, Regulations and Codes of Practice he is being investigated by Consumer Affairs Victoria
    The key point you have all ignored is that the contract is unconditional, with NO 'Subject to Finance' clause
    DavidM It may have paid you to take more than a "brief look" at the Victorian standard form Contract of Sale before posting your reply as you may have noted:
    10.1 Specifically states "At settlement", not before settlement
    b. the vendor must:
    (i) do all things necessary to enable the purchaser to become the registered proprietor of the land
    10.2 The vendor's obligations under this general condition continue after settlement.

    14.1 If the particulars of sale specify that this contract is subject to a loan being approved, this contract is subject to the lender approving the loan on the security of the property by the approval date or any later date allowed by the vendor.

    22. Inspection
    The purchaser and/or another person authorised by the purchaser may inspect the property at any reasonable time during the 7 days preceding and including the settlement day.

    If you are the successful bidder at auction:
    you will be offered a contract in the same terms that was on display before the auction. You cannot make the contract subject to any further conditions - for example, obtaining finance or having a longer settlement period, unless the seller agrees to them.
     
  19. thatbum

    thatbum Well-Known Member

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    If you don't want criticism, then don't make a post seeking advice on how to behave in an apparently reprehensible way. You didn't even give any explanation or context - what did you expect?

    Your reasons don't seem to justify your actions either. Why be a jerk to the buyer if its your own agent you have an issue with?
     
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  20. Trainee

    Trainee Well-Known Member

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    You wanted the answer you want to hear. Maybe ask it to the mirror?

    You would be breaching the 10.1.b.(i) you quoted, op. What issues you have with your agent has nothing to do with the buyer. How does it help you if the buyer cant get finance? You have an unconditional contract, but are you willing to spend thousands to enforce it if the buyer cant settle as you were unreasonable? You might not even win that.
     
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