What can you do after vendor cancels S & P Contract

[Lauren69]

We had found our dream home and paid deposit; Unfortunately, they canceled the Contract after waiting the extra 12 days from default of Settlement

- Please note, our property failed to Settle because the Purchaser Defaulted, and we have started Litigation to recover costs.
As well as losing our new family home we have now also lost our $50,000 deposit, and have incurred massive Default penalties because of this.

Because of that, the new property we were buying got defaulted on and after timeframe ended the vendors canceled the contract. We still would love the house as we had fallen in love with it and want to try and be able to still purchase it.

My question is…………… If we managed to get our purchaser to pay up or if we sold our property quickly and had the funds to settle on the new house in a week or so, is there anyway way of getting vendors not to Relist straight away, so we could at least try?

[McDuck]

My question is…………… If we managed to get our purchaser to pay up or if we sold our property quickly and had the funds to settle on the new house in a week or so, is there anyway way of getting vendors not to Relist straight away, so we could at least try?

Possibly.

Talk to the Real Estate Agent representing your dream house.
Let him or her know what the deal is.
See if he/she can work out some sort of arrangement.
If no one is representing your dream house now, ask the agent to ask the owners of your dream house to call you.

In a dropping market, the seller of your dream house may be less fussy.

it's worth a shot.

Remember, the agents are working in their own best interests,
as well as the home owner's.

So they may not help if there's nothing in it for them.

It's my guess that the dream house owner will be wanting nothing to do with a deal gone bad, and will be looking for a fresh start.

Possibly even another agent, judging by that sloppy paperwork you mentioned.

A few too many corners cut, if you ask me.

[Lauren69]

Thanks for your reply
The Vendors Agent has been great, she was actually the one that really pushed for the Vendors to pick us after their first offer fell through earlier this year.
As she was working for the Vendors I don’t think there was much she could have done for us really.

The Vendors have been good, they knew what we wanted to create with the property and really hoped that everything would be fine, they were fine about the extended timeframe too.
They weren’t going to be purchasing any property, as they are separating and splitting the money, they had already secured their separate living arrangements.
Apparently, they didn’t want to have to go through the whole process again.

I have made contact with her today and will be contacting me later today.

(You now know it’s all gone down for us, sorry I haven’t updated other post yet, I’ve just been trying to come to terms with it all. But I will do that over the weekend once I’ve found my words)

[McDuck]

Hi, yes it is all an unfortunate waste.

The man thing is to stop all losses and move forward.

Just to get some clear numbers, what's the amount and nature of the penalty fees?

Did you pay a five or ten percent deposit?

And on the prevention front, have you found some good conditions to add to future offers.

Also be good to know exactly why your buyer defaulted, so you can decline that sort of offer in the future.

I'm really curious as to this multiple sale thing.

Did the buyer intend to contract flip all along, just to make a quick buck?
Or did thy just do it later, trying to save the deal once their funding fell through?

Mostly, why was the contract paperwork on your house missing the buyers name?

It seems that there's something not right in the way all of this was handled..

[Lauren69]

You’re right about how this has been handled
They paid 8% deposit.

So far I’ve calculated $5772.00 and that’s not everything yet, then if you add in the 15% Default fee of the balance owed at Settlement $126,000 and the $50,000 deposit we paid for new property, comes to $181772.69.
Then, there will also be the cost of Litigation to add to that as well.

Apparently it’s the last buyer that has not settled with the original buyer. I just don’t get why or how that should be our problem, but it is.

I believe they had every intention of House Flipping right from the start. From my research I have found out the original buyer is not from Auckland and is a Property Trader.

The missing information on our contract is at the fault of the RE Agent.
I have lodged a complaint with REA in regards to the Agent/Agency as we strongly believe that the Agent has not acted in the best interest of their client (us), and from what REA has said there is definitely a case. I will definitely making sure to complete that whole process.

I also feel that our Lawyer hasn’t done her job very well at all because she should of noticed the missing information and bought it up.
Like, I have no legal background or haven’t had much dealings in contracts at al and that was one of the first things I spotted and mentioned it to my partner as I didn’t think it was right at all.

[McDuck]

Looks like you have four jobs at once.

I guess you could sequence them.

Human attention can only be in one place at a time.

job 1. Tally up total losses, and stop further losses.

job 2. Recover losses from contract defaulter.

job3. Secure dream home deal#2, if possible.

job 4. Maintain pleasant environment for children and self, ( un-stressing activities ).

Simplify:

job1: tally 6 + 50 +126 = 182. plus ongoing.

job 2. recover losses.

job 2 , Step 1

Ask real estate agent why there is no signature on the contract.
If that fails, ask his employer .
Once you can locate a signature, you will then know who you have a house sale contract with.
Ask the REA to assist. Their phone number is on their website.

Good luck. McD.

[donna]

Nice one McDuck very helpful replies.

Mostly, why was the contract paperwork on your house missing the buyers name?

Agree the agent and the lawyer are negligent.

If you can’t trust the professionals to have your back who can you trust!

Keen to hear what the lawyer says and REAA.

Lauren did you click that link I put in the other discussion as it had three options - the second and third proving more doable and with higher chance of a successful outcome for you with little to no outlay.

cheers

Donna

[McDuck]

Nice one McDuck very helpful replies.



Agree the agent and the lawyer are negligent.

If you can’t trust the professionals to have your back who can you trust!

Keen to hear what the lawyer says and REAA.

Lauren did you click that link I put in the other discussion as it had three options - the second and third proving more doable and with higher chance of a successful outcome for you with little to no outlay.

cheers

Donna

I just cant figure out if they are slack, stupid or greedy and working together.

Really need to go visit the people and see the paperwork to get true read on this.

So disappointing, when you spend money on professionals and get this pitiful service.

If the REA have any teeth, someone's going down.
If not, the REA needs to be replaced by a real governing body. (last chance guys).

[chook]

"Nice one McDuck very helpful replies."

Agreed, good work Mcduck, I havent fully followed it and cant work out how Lauren lost her $50,000 deposit, but someone needs to pay..

[donna]

^^ my understanding is as Lauren didn’t settle due to the buyer of her home defaulting she lost her deposit + owes 15% default fee - an unbelievable mess that should never have been allowed to happen.

cheers

Donna

[chook]

Yes but shouldnt she have got the deposit from the buyer of her home?

In these situations you should always make sure your buyers deposit is the same or higher than Laurens deposit.

[driftah]

Regarding your intended purchase of dream home...Its sounds like you're on OK terms with the sellers so I would suggest negotiate another contract with them. As McDuck has mentioned, include clause that the contract is conditional upon your current house sale. You may have to make the timeframe short to be acceptable, but better than no contract at all. Try and see if they will give up their rights to enforce the penalties if you do end up purchasing (make sure this is in the contract!).

Just to further reinforce as others have said... it doesn't matter if the original purchaser of your property has assigned the purchase rights of the contract to someone else. The original purchaser is still responsible and liable if they are in breach of the contract.

Why did they cancel the contract? Assuming they have gone unconditional, there are very few cases for them to be able to rightfully cancel the contract. It is most likely they are in breach of the contract and you can sue them.

I would think in most cases the real estate agent fees are only payable when the settlement has taken place.

Regarding the things missing from the contract and assuming I've understood your post correctly: The page with contact details is not critical to the contract. It sounds like you have their name on the first page, they have signed the contract, they've agreed to a contract and the contract went unconditional. If this is true then you are in a strong position to not lose out on your sale.

It doesn't mean you will get the particular dream home you've spotted now, but just remember there's always another deal out there just as good, if not better!

[Keys]

I would think in most cases the real estate agent fees are only payable when the settlement has taken place.

I believe fees are due upon unconditional contract.

[McDuck]

Yes but shouldn't she have got the deposit from the buyer of her home?
In these situations you should always make sure your buyers deposit is the same or higher than Laurens deposit.

From what I can tell, the real problem was the late settlement fee.
That was over three times the 50K deposit.

To me this sort of behavior is typical in all industries.

When people get comfortable in their jobs they get sloppy and cut corners. Make up shortcuts etc.
Which is fine, until something goes wrong.
Then everyone is running to hide and trying to cover their behinds.

You get some incredibly stupid people, who think they are clever by gaming the system.
Then when it falls over, they (still being stupid), put it all down to bad luck.
A word to the young.
Follow the rules and procedures.
They will save your butt one day.
Oh, and keep all your emails on important matters.

[donna]

We want Lauren to come out of this with her home sold, and her family in another.

Plus the ‘trader’ has to his default fees and Lauren’s out of pocket costs.

How can the trader be made to pay? If he is a has no assets or funds - what happens next?

cheers
Donna