I signed a contract with a builder for a new house, this house was a standing inventory with some upgrades already in the house, the price was 300's they paid closing cost and gave me FHA with a small down payment by their part, so my new mortage will be 294500, but heres my concern:
I haven't close on the deal, and they have lower the base price of their homes on same models to 304's, and from what i have seen they might go lower than that, would it be wise to honor the deal knoiwngly that my un purchased house could be devaluated by the builder if they keep lowering the price? should I ask for a better price? or just completly back out?
I close in two weeks.
2007-11-03 10:55:37 · 10 answers · asked by coolricksTJ's 1 in Business & Finance ➔ Renting & Real Estate
Thanks for all the answers, to: credit expert: the house I'm buying has 15000 in upgrades that were not chossen by me , it was already built and was standing inventory for at least 7 months, I did not put down payment they did, like I said they are lowering their base price to 304's but they will go much lower than that, close to 290-295!!!!, as for upgrades they have been givin them away free of charge, see my concern??? there was suppost to be an inspector appraising the home before the deal closes with comparables, I asked for that report, they have been giving me the round arround, could this be a sign that my new house does not worth what I haven't even paid for?
2007-11-03 13:54:37 · update #1
Interesting scenario, however look at your numbers. You are paying $300k, they are asking $304k for other similar houses with maybe -0- upgrades? You say they are devaluating your property value??? A little clarity is necessary here.
Just for the heck of it in case your numbers are backwards:
How are Damages Computed in Real Estate Contracts?
Every property, house, or building has a market value. However, the contract price may be different from the market value. In real estate contracts, the difference between the market value and the contract price is the recoverable damages. The recoverable damages are called expectation damages. If the contract price is equal to the market value, no expectation damages will be awarded.
Best bet is to talk to the builder. Show him what you just found out. Try to renegotiate price. Set up a consultation with a REAL ESTATE ATTORNEY, but not the CLOSING ATTORNEY.
Show some clarity on YOUR NUMBERS PLEASE. Yikes!
2007-11-03 11:53:09 · answer #1 · answered by Credit Expert 5 · 0⤊ 0⤋
First of all, if you back out, you will lose any earnest deposit money you have put on this house at your time of contract. Go and talk to your sales agent and explain your concerns. This builder really does not want to have this as standing inventory again and will probably work with you to keep you from backing out. Maybe you can get them to include finishing the backyard with landscaping or they may even reduce your final sales price. However, you better do this ASAP, because any changes have to be reviewed by the FHA underwriter and could delay your closing. Most builders will charge you 1 to 2 percent on the final sales price as a late charge for each day following the proposed closing date
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On that appraisal, if you have not paid for that appraisal, they are not at liberty to release a copy to you. More than likely that cost is included with your closing cost and you would not be able to get that until after closing. Plus if that appraisal does not come to the value that's anticipated, the underwriter will not let the loan documents be released. With no loan docs, there will be no closing unless some numbers such as the final sales price is adjusted down. Believe me, the builder will see to it that this deal closes to the satisfaction of every party involved. The lender will see to it as well. The market is too slow and year end is drawing near. The builder can't afford to this closing.
2007-11-03 11:22:44 · answer #2 · answered by Anonymous · 1⤊ 0⤋
If you are only two weeks away from closing, you're too far into this deal to back out without some serious financial and legal repercussions from the builder.
Aside from that, would you be asking this same question if the builder had RAISED their base price ? The same concept applies here.
2007-11-03 11:00:41 · answer #3 · answered by acermill 7 · 0⤊ 1⤋
I don't see a problem in asking for a better price, though they are probably not obligated to agree to it, unless they have a price guarantee policy.
Backing out altogether will probably lose you your down payment.
Your best bet would be to speak to a real estate professional and/or a lawyer to see what options you have.
2007-11-03 10:59:52 · answer #4 · answered by Tor 4 · 1⤊ 0⤋
You can certainly ask about changing the contract. If it is mutually done prior to closing, there shouldn't be any penalty.
Look at your contract and see if there is anything in there about canceling the contract. Can you use any of those clauses?
2007-11-03 10:59:09 · answer #5 · answered by Dan H 7 · 2⤊ 0⤋
call a real estate attorney, and do it quick
she or he can easily tell you what your options are depending on what you signed; it will be worth a few dollars for the piece of mind even if you do nothing
2007-11-03 10:59:14 · answer #6 · answered by yyyyyy 6 · 1⤊ 1⤋
If you haven't closed you should be able to back out or adjust the deal.
2007-11-03 11:03:33 · answer #7 · answered by Dirty Dave 6 · 0⤊ 1⤋
Forget it, breaching the contract can cost you some big bucks.
2007-11-03 10:58:10 · answer #8 · answered by WC 7 · 0⤊ 1⤋
i'd spend the money on getting someone who can give you real advice on this matter. a realestate lawyer perhaps?
2007-11-03 10:59:23 · answer #9 · answered by Whole 4 · 1⤊ 1⤋
get a lawyer.
2007-11-03 10:58:26 · answer #10 · answered by Anonymous · 0⤊ 1⤋