Accepting an offer by phone doesn’t actually count

Q: My wife and I made an offer on a home. Our real estate agent texted my wife about a phone call from the owner’s real estate agent saying the owner accepted our offer, and they would send the paperwork the following day. Two days passed with no paperwork. Then the owner’s real estate agent contacted our real estate agent saying another offer came in for more money, and they were going to accept that offer.

I thought a verbal agreement was a binding contract. Do we have any legal recourse? We were not even told the amount of the other offer or given a chance to raise our bid.

A. A law known as the statute of frauds requires that contracts for the sale of property be in writing and signed by the parties. Oral agreements don’t count. On top of that, sellers have the right to keep other offers confidential, and they have no obligation to negotiate if they choose not to.

Unless you can show there was some discrimination that violated fair housing laws, just chalk it up to bad luck. I’ll bet there’s an even better house waiting for you somewhere out there.

Q. Please advise the best way to sell a home. We have an offer at $191,000, but they would like us to pay 2 percent of their FHA closing costs. This would come to $19,280 if the appraisal comes in at $180,000. Is there a better way? We have to pay 6 percent and the buyer has to pay 6 percent. Thank you for any advice.

A. I don’t know your market or what the house is worth, but I can straighten out a few things.

First off, it’s not unusual for buyers who don’t have a lot of cash to ask for what are known as seller concessions, to help with closing costs. Two percent is a reasonable request and would cost you somewhat less than $3,800. I can’t be specific because some of the closing costs are based on the amount of the mortgage. My guess is that these buyers might be borrowing close to the whole purchase price, because FHA allows low down payments.

The bank’s appraisal of the value of your house will have to be for at least the sale price — $191,000. Otherwise, it wouldn’t be safe for them to lend the amount the buyers need. And finally, if that 6 percent refers to the agents’ commission, I very much doubt that both you and the buyers would be paying it. Your agent can explain.

Q. My wife and I want to sell, but we have a lien on our home. Is it possible to sell a home that has a lien on it? What do we need to do to sell it?

A. Most houses now up for sale probably have at least one lien, a financial claim, against them. Most often it’s an existing mortgage, but it could be something like a judgment or back taxes. Rarely, a buyer will agree to take the lien along with the house. Usually, though, existing liens will be paid off at the closing, using some of the proceeds from the sale. Some mortgages, for example, can be assumed by the next owner. It’s a routine procedure.

If the lien on your house is for a smaller amount than your sale price, you’ll be fine. If you owe more than the house is worth, I’m afraid you have a problem I can’t solve for you.

Q. I’m considering selling my home. I would like to move into an apartment or rent for two years. I’d have a roommate to split the bills. Will this be a problem with taxes when I sell and make a profit off the house without reinvesting with another home? I’m afraid this won’t really be worth it if I’m taxed on my profits. Please help me decide!

A. OK, which do you want first, the good news or the good news?

The rules for the home seller’s tax break changed a number of years ago. The IRS no longer cares how old you are or what you do with the proceeds from the sale of your home. If the place has been your primary residence for at least two of the five years before you sell, as a single taxpayer you can take up to $250,000 profit free of capital gains tax. You could even do it again on future homes as often as every two years. Simple as that.

Ÿ Edith Lank will respond to questions sent to her at 240 Hemingway Drive, Rochester, N.Y. 14620 (include a stamped return envelope), or readers may email her through askedith.com.

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