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jack_hellz

New construction closing issue

5 years ago

like most I started looking for new construction in NY online. We have been in contract more or less since March/April of 2020. Now the bank cleared us to close, the seller didn’t want an inspection which isn’t necessary but my wife and I wanted one For our self’s not the bank. scheduled one and notified the seller agent, set the time for Saturday and no issue. On Friday night we reach out to the agent to confirm and she informs us the seller has returned our earnest money and reposted the property. Please take note the title hasn’t cleared on their part. Now we are in contract, our real estate lawyer confirmed that the seller can’t just return the money. While the property was online they may have shown it and received an higher offer. Also seems like the seller instructed his attorney not to talk to our attorney. Title should clear today and we stressed as to why this developer would do this one week away from closing. I think he may be strong arming us for more money which I dont want to give. Taking him to court will cost us thousands or even years. looking for some good advice, thank you in advance!

Comments (11)

  • 5 years ago

    You just said you have a real estate attorney. Chances are really good that person will know a whole lot more about your options and best paths forward than a bunch of strangers on the internet. :)

  • 5 years ago

    Clarification ... you signed a contract to build a house back in March 2020 and the house is now finished and you were supposed to close next week?

    Have you been inspecting or visiting this house as it has been built?

    Don't you find it odd that the builder doesn't want you to inspect the house you are buying? What is he hiding?

    Either, the house has many issues that an inspector will tag and/or he found someone willing to pay much more than you were and willing to take buy an AS IS house.

  • 5 years ago

    Yes I been to the house through out the build with my wife and two girls. yes of course he mentioned he got a higher offer. Now to see if I can get a legal representation if needed. I believe he just may want a higher down payment.

  • PRO
    5 years ago
    last modified: 5 years ago

    He can sell it for way more than your contract amount. You’re not going to spend money to compel enforcement of your contract. If you wanted the inspection, “just for you”, it should have been scheduled after closing. You thought you might have leverage after turning up a problem. He isn’t playing that game. He is on to the next person in a multi bidder scenario.

  • 5 years ago

    Doing an inspection does not give him the right to terminate the contract. Call his bluff if you really want the property and seek specific performance on his part and have him pay for the cost of the process if you win.

  • 5 years ago

    I’m doing a time of essence letter 2 weeks to close ( calling his bluff ). also getting multiple attorneys choice from friends and family pro Bono. I’ll tie up the property with a lien and have it there till he cracks.

  • 5 years ago

    You'd have to get a judicial injunction to prevent him from selling it.

  • PRO
    5 years ago

    Shola:


    The builder has already calculated his lawyer fees and settlement into his cost/benefit analysis of whether or not to cancel this deal and sell to a higher bidder. I'm betting he's still money ahead. Lawyers love this kinda crap.

  • 5 years ago

    Personally I would get the lis pedens on the property as fast as possible and take my time with everything else.

    Once that notice is filed he will not be able to sell it as a title search is going to find it. In my area, courts are so backed up right now that filing an action and a lis pedens would essentially wrap up the property for a year.

    However, I will caution that size does matter sometimes. If this is a small local production builder then go for it. If this is a large regional or national builder I would spend some time thinking things over before jumping in.

    Good luck


  • 5 years ago

    Local builder, also just found out his withholding on signing the affidavit for the title to clear.

  • 5 years ago
    last modified: 5 years ago

    Just my 2 cents on your position and options.

    First, you need to quickly decide if this thing will resolve with communication or whether it is going to require a bit of a push to resolve.

    Next, the legal system really has two uses. You can use the legal system to resolve issues, which usually take significant time and resources. Or, you can also use the legal system to force reasonable settlement of issues outside of a courtroom. In my opinion, the latter is preferred to the former.

    I would advise having a discussion with your attorney about skipping the back and forth part of demand letters and just filing the case and the lis pedens. That will likely force the builder to sell it to you or at least force a conversation on getting this fixed. Odds are your builder has overestimated the power he has in this matter, owning a house that you want to buy certainly gives him some power, however, having money tied up in a house that no one but you can buy drastically shifts that power dynamic. I doubt the cost to file the case and the lis pedens is significantly more than back and forth demand letters and is much more likely to result in favorable action, possibly even having him reimburse you for those fees.

    Having said that, listen to your attorney. There are always nuances in your specific situation and jurisdiction that don't translate well to on-line advice.

    Good luck