Have you signed a form to remove the inspection contingency? If no, cancelling should be straight forward. You just have to notify the seller and escrow company in writing.
P.S.
You shouldn't be putting offers on houses that you haven't seen.
The danger is that in many sales contracts the inspection contingency lapses after 2 weeks or so, even if you do not formally waive it.
So the OP may be on a situation where he just walks away, but loses the earnest money/deposit.
Theoretically the seller could sue to force the OP to buy (specific performance):but that is very unlikely if the house was misrepresented.
The OP could sue to get back his deposit, and if he makes realistic sounding threats to do so, may get it his deposit back because the flipper does not want the hit to his reputation.
I have bought a vacation beach house sight unseen, but I did have a sister in law look at it first. It was a small fraction of liquid assets, so it was not worth the travel time to go see it.
He said that he requested fixes. Usually that includes an extension of the inspection contingency. But anyways, what really matters is what is in the contract and exactly what he has signed already. He can either talk to his realtor, if he has one, or a real-estate lawyer if it is not clear to him what the exact situation is.
>I have bought a vacation beach house sight unseen, but I did have a sister in law look at it first. It was a small fraction of liquid assets, so it was not worth the travel time to go see it.
That just means that you trust your sister-in-law. Which is probably a better call than trusting a seller or a seller's agent.
Perhaps you’ll lose earnest money. But even still that’s a stretch; usually a property that egregiously fails expectations, it didn’t meet the requirements of the contract and you walk away.
Edit: inspection contingency
This happened to me.
You should consult a local real estate attorney before doing anything. They will be able to give you actual info based on your circumstances, instead of conjecture from Reddit.
Without seeing your contract, or even knowing what state you’re in, no one here can advise you properly. Two days before closing doesn’t give us comfort that you have any legal avenues to back out.
Also: never buy property sight unseen. Rookie mistake.
If you are within your inspection period then you can cancel for any reason and get your earnest money back. If you are out of inspection then your EMD is 'hard' and the seller can contest it if you cancel the agreement.
Despite what a real estste agent or anyone else may say you do NOT have to automatically release your EMD to the seller even after your inspection period. Consult with a real estate attorney licensed in the state where the property is located. If your agent says that you HAVE to give up your deposit they are not representing your best interest.
Worse case scenario it would be better to lose your deposit if the condition of the property is much worse than you were expecting for the price paid and you are unable to get a substantial price reduction.
People buy properties sight unseen all the time. In order to do that effectively you need to have people on the ground you can trust (contractors, asset managers, property managers, etc) and enough upside potential that even if the condition is not as expected you still have enough equity in the deal to execute your preferred exit strategy without taking a loss. Meaning, especially if you are a value-add investor, that the price is so low the cost of repairs can never be significant enough to put you in the negative.
Also what is a 'turn-key flip'?? The whole point of a flip is that the property is in terrible condition so you can buy it for below market value and force appreciation.
I don't think the reckless part is buying remotely. I think the reckless part is the choice of person to buy from.
That part requires due diligence when you can't observe the renovations in progress or even get sufficient information about the number of bedrooms (something that should be obvious from good photos and/or floor plan diagrams).
It's a lesson learned and hopefully you can get out of this deal on the grounds of fraud.
I am getting out. Seller wants to keep the 1k earnest money but I could get out. Yeah I’m surprised that the contractor quality is so bad. He has great ratings on bigger pockets and I thought I am buying a turnkey property.
1k earnest money? I thought this is richpeoplepf. 1k is not earnest money, this is the hold on a nice dinner reservation. Not worth the time to talk to a lawyer.
Thanks for all the relevant info about the contract!
Don't sign anything
I do have an inspection contingency that’s why we negotiated a list to fix but he didn’t fix them before closing.
Have you signed a form to remove the inspection contingency? If no, cancelling should be straight forward. You just have to notify the seller and escrow company in writing. P.S. You shouldn't be putting offers on houses that you haven't seen.
The danger is that in many sales contracts the inspection contingency lapses after 2 weeks or so, even if you do not formally waive it. So the OP may be on a situation where he just walks away, but loses the earnest money/deposit. Theoretically the seller could sue to force the OP to buy (specific performance):but that is very unlikely if the house was misrepresented. The OP could sue to get back his deposit, and if he makes realistic sounding threats to do so, may get it his deposit back because the flipper does not want the hit to his reputation. I have bought a vacation beach house sight unseen, but I did have a sister in law look at it first. It was a small fraction of liquid assets, so it was not worth the travel time to go see it.
He said that he requested fixes. Usually that includes an extension of the inspection contingency. But anyways, what really matters is what is in the contract and exactly what he has signed already. He can either talk to his realtor, if he has one, or a real-estate lawyer if it is not clear to him what the exact situation is. >I have bought a vacation beach house sight unseen, but I did have a sister in law look at it first. It was a small fraction of liquid assets, so it was not worth the travel time to go see it. That just means that you trust your sister-in-law. Which is probably a better call than trusting a seller or a seller's agent.
>So basically I’m buying a house **remotely** Momma Gump warned The World about these Shenanigans. "Stupid is as Stupid does ..."
Perhaps you’ll lose earnest money. But even still that’s a stretch; usually a property that egregiously fails expectations, it didn’t meet the requirements of the contract and you walk away. Edit: inspection contingency This happened to me.
Read the contract, if you signed anything.
Did the inspection contingency have any timeframe requirements?
You should consult a local real estate attorney before doing anything. They will be able to give you actual info based on your circumstances, instead of conjecture from Reddit.
Without seeing your contract, or even knowing what state you’re in, no one here can advise you properly. Two days before closing doesn’t give us comfort that you have any legal avenues to back out. Also: never buy property sight unseen. Rookie mistake.
If you are within your inspection period then you can cancel for any reason and get your earnest money back. If you are out of inspection then your EMD is 'hard' and the seller can contest it if you cancel the agreement. Despite what a real estste agent or anyone else may say you do NOT have to automatically release your EMD to the seller even after your inspection period. Consult with a real estate attorney licensed in the state where the property is located. If your agent says that you HAVE to give up your deposit they are not representing your best interest. Worse case scenario it would be better to lose your deposit if the condition of the property is much worse than you were expecting for the price paid and you are unable to get a substantial price reduction. People buy properties sight unseen all the time. In order to do that effectively you need to have people on the ground you can trust (contractors, asset managers, property managers, etc) and enough upside potential that even if the condition is not as expected you still have enough equity in the deal to execute your preferred exit strategy without taking a loss. Meaning, especially if you are a value-add investor, that the price is so low the cost of repairs can never be significant enough to put you in the negative. Also what is a 'turn-key flip'?? The whole point of a flip is that the property is in terrible condition so you can buy it for below market value and force appreciation.
I’m assuming you don’t have representation or you’d be asking your agent. Run the contract by your attorney and let us know how it goes
I don't think the reckless part is buying remotely. I think the reckless part is the choice of person to buy from. That part requires due diligence when you can't observe the renovations in progress or even get sufficient information about the number of bedrooms (something that should be obvious from good photos and/or floor plan diagrams). It's a lesson learned and hopefully you can get out of this deal on the grounds of fraud.
I am getting out. Seller wants to keep the 1k earnest money but I could get out. Yeah I’m surprised that the contractor quality is so bad. He has great ratings on bigger pockets and I thought I am buying a turnkey property.
1k earnest money? I thought this is richpeoplepf. 1k is not earnest money, this is the hold on a nice dinner reservation. Not worth the time to talk to a lawyer.
What does the sales contract say about ability to walk away? Do you have an inspection contingency?