Buyers, sellers often continue negotiates after the deal
Q. We are attempting to sell our home. We signed a contract and thought everything was fine. Since then, their attorney has raised many issues with the contract and their home inspector raised some issues with the condition of our home. We have been going through a long negotiating process over these issues. This has been going on for almost two weeks.
Yesterday, another couple made an offer far more attractive than our current offer, plus, they seem like they will be much easier to deal with. Can we just end the negotiations with couple No. 1, tell them the deal is off and move on to couple No. 2? Our attorney seems hesitant to do this, saying we need to give couple 1 one last chance before pulling the plug. Your thoughts?
A. Your attorney is far more knowledgeable about your current transaction than I am, so to attempt to override his advice would not be prudent. I will however, offer some general thoughts regarding your situation.
I presume from your letter you are negotiating pursuant to the attorney review and home inspection provisions of your contract. The attorney review provision allows either attorney to suggest "modifications" or "changes" to the contract (except price). The home inspection contingency allows the purchaser to inspect the property and based on the results of the inspection, either request repairs to the property or terminate the transaction.
There are numerous form contracts and it would be impossible to comment on every one. However, one of the most commonly used contracts in our suburban area is the Multi Board Residential Real Estate Contract. This contract recognizes two types of attorney review communications, one proposing modifications to the contract and one suggesting changes to the contract. You are probably now thinking "What's the difference?"
The difference is how the form contract treats modifications vs. changes. If a party requests a "proposed modification" to the contract and within 10 business days of contract acceptance a written agreement is not reached regarding the modification request, either party may terminate the contract. However, if a party makes "suggested changes" to the contract, these changes generally cannot be the basis to terminate the contract. In other words, if purchaser requests suggested changes to the contract and seller refuses, purchaser has the right to withdraw the proposal and continue under the original provisions of the contract.
In some instances, attorneys, to protect their clients from unintentionally losing the deal, make "suggested changes" to the contract. This way, if the changes are not acceptable to the other side, the party proposing the changes has the option of withdrawing the request and operating under the original provisions of the contract. It is possible that is what your purchaser's attorney did, which would then lead to your attorney's advice to you.
Now, in the event you are battling over home inspection issues, this may very well be a different story. Again, referring to the same form contract as above, the parties, to protect their rights under the contract, must resolve all home inspection issues within 10 business days of acceptance. Once that time period has passed and home inspection issues remain unresolved, either party may terminate the contract.
Most attorneys act cautiously when their clients wish to terminate contracts. Terminated contracts sometimes lead to angry parties and angry parties sometimes leads to legal action. Presuming your attorney is experienced in real estate transactions, my guess is he is giving you good advice.
• Send your questions to attorney Tom Resnick, 345 N. Quentin Road, Palatine, IL 60067, by email to email@example.com or call (847) 359-8983.
- Share Facebook Twitter
Article sent to (required)E-mail
Article sent from (required)E-mail Name
Subject Line (article title)
Message (optional)Success - Article sent Click to close
Interested in reusing this article?
Custom reprints are a powerful and strategic way to share your article with customers, employees and prospects.
The YGS Group provides digital and printed reprint services for Daily Herald. Complete the form to the right and a reprint consultant will contact you to discuss how you can reuse this article.Need more information about reprints? Visit our Reprints Section for more details.
Contact information ( * required )Name * Company Telephone * E-mail *
Article InformationTitle URL
Message (optional)Success - Reprint request sent Click to close