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Re: Selling my house part 2
Old 01-03-2006, 08:24 PM   #21
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Re: Selling my house part 2

No jabs here... :P

I vote #1 gets the house, since he made a deposit.
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Re: Selling my house part 2
Old 01-03-2006, 08:32 PM   #22
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Re: Selling my house part 2

Quick question to original poster, did you shake hands with the first buyer who gave you a check ?
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Re: Selling my house part 2
Old 01-03-2006, 08:32 PM   #23
 
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Re: Selling my house part 2

Quote:
Originally Posted by davew894
The baby boomers made it so they don't have to worry about such trivial issues (and can feel good at the end of their lives). Personally, I think the system sucks (if you haven't been able to tell by my previous posts) and I would have loved to have lived in the time where honor and a man's word meant something. I didn't make these rules, I was born into them. One can't be held to a higher standard and expect to compete... that's simply a fools game.
You're really amusing that you think the Baby Boomers created all the rules that only YOU have to live with!

I have never created any rules either and have been forced to live with more rules than you sonny! - I still keep my word and compete at a disadvantage. I think the accountant at Enron (that is currently in the slammer) lives by the same rules as yourself.
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Re: Selling my house part 2
Old 01-03-2006, 09:36 PM   #24
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Re: Selling my house part 2

Different opinion?

How about what is reasonable and customary, and who is looking to suffer the most from a change to the deal.

In most states...all of them i'm aware of...a real estate purchase and sale contract signed by both parties is required before a deal is a deal. I can think of a number of times I met a buyer or seller, talked to them directly and sent or received an offer or check, got verbal confirmation and then a better deal came in.

Once a P&S is signed, it usually outlined who gets what if the deal is broken. Usually the seller gets to keep all or part of the deposit if the buyer bails. The buyer usually has to go to mediation or sue if they seller backs out. Most people dont bother with the latter and when they do, its usually a waste of everyones time.

So a check and a handshake constituting 'reasonable and customary" conclusion of a real estate transaction? Not in my experience.

As far as damage...the guy who wrote a check probably didnt run off and sell his house and pack up his belongings in anticipation of moving in the next day. He's probably out the cost of a check and a little disappointment. The OP could be out 30k. A little disparity.

About the only arguable and so far not described portion is how the verbal piece of the 'deal' played out, and how badly the OP will feel about it. If I told someone "its a done deal, we'll do the paperwork tomorrow but the house is yours, nice doing business with you"...thats one thing. If he took the check and said "lets sit down and do the paperwork tomorrow, i'll cash your check when thats in place"...thats another thing.

In any case, the original buyer has the discretion to make the deal providing he comes up to the level the market appears to be willing to pay. His decision to not do that, providing he wasnt told "its yours for sure, done deal, end of story", forfeits his claim.
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Re: Selling my house part 2
Old 01-03-2006, 09:44 PM   #25
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Re: Selling my house part 2

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To me it doesn't make any difference.

MJ said he made a deal and that's that, yea legaly he could walk away. But what's right is right.

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Re: Selling my house part 2
Old 01-04-2006, 12:12 AM   #26
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Re: Selling my house part 2

The lawyer, conservative in me, agrees with Rapoole. See a lawyer if you don't sell to the first person. Edit: Even though purchase agreements have to be in writing, there are exceptions in some circumstances if someone changes their position in reliance on a verbal understanding.

The honor question? I am not sure that MJ and the first buyer really thought they had a firm deal. MJ listened to other offers. The first buyer raised his offer to meet the second buyer's offer. They didn't write it down. It looks as if details were not discussed. What was the plan for putting together a written agreement? Or was there one? Not enough facts to know for sure if there really was a "deal."

This is why agreements should be in writing. One or the other party might not be on the same page. If you write it down, the chance of a misunderstanding is reduced. It may not be so much a question of honor but an issue of whether there was a "meeting of the minds."

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Re: Selling my house part 2
Old 01-04-2006, 02:47 AM   #27
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Re: Selling my house part 2

At the root of all of this ... as have many on this board, my DW and I have bought and sold a fair number of homes now. We have never considered doing so without either an agent representing us, or at least working closely with a title company (generally didn't live in states requiring an attorney) to generate the correct paperwork. And we only did our own deals with minimum representation after much experience (and after both of us had held real estate licenses).

At least go to a title company or attorney now to handle your transaction correctly.

With respect, to you and the comments above, if you make a deal in the future, for anything, changing your mind the next day can and will leave you open to legal and reputation problems. Just not good form.

Good luck.
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Re: Selling my house part 2
Old 01-04-2006, 07:08 AM   #28
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Re: Selling my house part 2

Quote:
Originally Posted by Brat
Jay, get a real estate lawyer ASAP and have that person sort this out.
I'm not the one selling the house... I'm a lawyer and would have never done things this way.
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Re: Selling my house part 2
Old 01-04-2006, 09:25 AM   #29
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Re: Selling my house part 2

Oy...

I agree with Martha, that offerer #1 did increase his bid, so he was in the game, so to speak. Still, he made a deposit, and should get first rights.
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Re: Selling my house part 2
Old 01-04-2006, 10:20 AM   #30
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Re: Selling my house part 2

Opps, by bifocals caught the wrong OP handle. I will correct my post. Thanks.
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Re: Selling my house part 2
Old 01-04-2006, 10:32 AM   #31
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Re: Selling my house part 2

Quote:
Originally Posted by 73ss454
To me it doesn't make any difference.

MJ said he made a deal and that's that, yea legaly he could walk away. But what's right is right.
Repeating the part where I noted we didnt really get much detail on how the deal was "made".

And the part about reasonable and customary. In the vast majority of home sales, a P&S with conditions and contingencies are listed is required before you "have a deal".

Let me give you an example of why that may change a few things. Say the buyer cant get a loan. How about if the buyer does a home inspection and it reveals major problems with the home that MJ doesnt want to pay to fix because he's sold the property for $30k (or more) below value.

Does that mean the buyer can forget they "had a deal" and walk away? You betcha. And it'd be specified in the p&s agreement they put on paper.

"Big" changes to the parameters of a deal usually mean some further analysis of the deal. Things like a better offer, problems with financing, problems with the property, etc. This isnt selling an old car or loaning your neighbor fifty bucks, its a six figure transaction with a five figure deviation. Sure, the original guy should have the right of first refusal to meet and make the deal.

Several aspects to this came to mind last night. Thought I'd share because i'm like that

#1: Separating the really well-heeled members here who can look at 30k as a trivial amount of money, i'm betting a lot of the "honor" supporters take the higher bid if its THEIR money.

#2: As a permutation of that, we're all whores, its just a matter of the price. Apologies to mother theresa and the 10-12 other people on the face of the earth who cant be bought or tempted at any price.

#3: I think the value of either using a professional or following the same procedures a pro would to do a large transaction has been highlit here. A written offer and written acceptance, followed by a purchase and sale agreement before a handshake or 'deal' is considered made would have been prudent, and still could and should be performed if it hasnt. The forms are usually available as part of a 'fsbo' package at many bookstores and websites and some notaries know where to get them if you cant find them.
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Re: Selling my house part 2
Old 01-04-2006, 10:42 AM   #32
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Re: Selling my house part 2

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I feel that once that handshake is done that the procedure of buying a home should be started at once. If the buyer doesn't qualify or the house is damaged the negotiations should continue at that point. If neither is satisfied the deal should be dead.

This shouldn't change the fact that MJ agreed to sell the house to that buyer for a said price.

Like I said before if the 1st buyer agreed to give MJ the additional 30K that's his business. There should be no question as to who gets the house.
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Re: Selling my house part 2
Old 01-04-2006, 10:49 AM   #33
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Re: Selling my house part 2

That would be swell if we knew the magically invented "handshake" ever occurred. All MJ said was the guy came over, made him an offer and left a check. We dont know what happened, so for the third time, we dont have much detail on what the "deal" consisted of or what agreements were made.

Without the specifics of what was said or agreed to, we're all reading what we will into this.
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Re: Selling my house part 2
Old 01-04-2006, 11:54 AM   #34
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Re: Selling my house part 2

Left him a check that he accepted. Doesn't this mean for the 4th time that they had a deal.
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Re: Selling my house part 2
Old 01-04-2006, 12:49 PM   #35
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Re: Selling my house part 2

Not at all.

I'm pointing out everyone was hung up on a "handshake" that MJ never said he made, and speculation as to who agreed to what.

Without further speculation, such as "maybe they talked about a price and the guy left a check while MJ told him he'd think it over", I'll wait to hear what exactly happened, was said and committed to before I question someones "honor".

So there ya go MJ, you're either a scumbag without honor for trying to get the best price you can for the biggest thing you'll ever sell and thereby assuring you and your family are best served financially, or you're not. Spoken by a bunch of folks with more money than most and absolutely no skin in the game.

73ss454, one last question going back to my earlier postulation, because I really want to understand your reasoning.

Explain to me the difference between a seller unexpectedly finding out his home has a higher value than he thought being different than a buyer unexpectedly finding out the home has problems, or a buyer (probably expectedly) finding out his credit is so bad he cant get timely financing?

In both cases, the value proposition changed. You seem okay with the deal voiding or going back to negotiation if something changes with regards to the buyer, but not for the seller.

Just for the record, I've received higher offers after accepting one and stuck with the one I accepted, but then the difference wasnt 30k. On the flip side, I had a seller back out of the deal about a week before it closed. I could have sued the recently widowed grandma, but I didnt. The whole thing left a bad taste in my mouth so I discontinued my efforts to buy about 6 single family homes that I could have grabbed up for about $150k a pop. All in the nice neighborhoods of Folsom California, where those homes ~6 years later are worth 400-500k each. By the way, she put the house back on the market for more money a couple of months later, probably when they thought I wasnt watching anymore.

Its all part of life.
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Re: Selling my house part 2
Old 01-04-2006, 01:12 PM   #36
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Re: Selling my house part 2

Many deals go down after they are agreed upon for one reason or another.

I'm not saying it shouldn't go both ways. Also If you remember I said that if the first buyer agrees to pay the 30K extra so be it. Just that he should have first shot at the house. MJ said he didn't know who to go with and I say the first guy.

MJ did not cash his check but did accept it and they agreed on the price. Which by the way was what he was asking.


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Re: Selling my house part 2
Old 01-04-2006, 01:19 PM   #37
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Re: Selling my house part 2

Ok I agree with that.
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Re: Selling my house part 2
Old 01-04-2006, 03:59 PM   #38
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Re: Selling my house part 2

I'm a bit confused. MJ wrote;

"The following morning, a 2nd buyer knocked on my door and was interested in my house too. He voluntaired to up the price by $30k. I contacted the 1st buyer and he matched the increase. I then contacted the 2nd buyer he again up the price by $30k but said he would not go any further."

So, if he were to take the first offer discussed, he'd be down $60,000 dollars, correct? I think we're asking a lot from MJ....
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Re: Selling my house part 2
Old 01-04-2006, 04:49 PM   #39
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Re: Selling my house part 2

First, you should get a lawyer. Second, you should consider doing the right thing and honoring your agreement with the first buyer. But if you want to go the legal route....

Whether you are obligated to the first buyer will vary from state to state. But the two major issues are:
Is there enough in writing to meet the statute of frauds? This is usually narrowly construed; if the check had both your names, the price, and the address of the property, that could be enough. Common law would fill in the gaps.
Statute of Frauds also requires the person the agreement is being enforced against to have signed the writing. So if the seller didn't sign it, (or endorse the deposit check) it's probably not enforceable.

As long as the buyer gets his money back, it's hard to see what other losses he has suffered.

As far as baby boomers being morally evil, etc. goes, that's a load of hogwash. The statute of frauds has been around for over 300 years, to keep all those merry old Englishmen honest. Trying to wriggle out of real estate transactions, after receiving a better offer, was hardly invented by the boomers....

-GenXer
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Re: Selling my house part 2
Old 01-04-2006, 05:21 PM   #40
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Re: Selling my house part 2

I think the common misunderstanding of the Statute of Frauds is being presented here. "There's no signed agreement" - that would be MJ's defense to the contract from the 1st buyer at common law. However, the 1st buyer would sue MJ for breach, depose MJ, and ask MJ if the contract was formed in the deposition (or in an interrogatory). Unless MJ lied and said no contract was formed, the contract would still be upheld*, in spite of the failure to satisfy the writing requirement of the Statute of Frauds. The statute of frauds is merely an evidentiary law, instead of substantive contract formation law. All you need is offer - acceptance - consideration.

Disclaimer: I'm not a real lawyer. I just went to school to be one.

*All this assumes an actual contract was formed between MJ and 1st buyer (but that may be up in the air).
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