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Dramatic negotiations while active under contract and in option period

10,067 Views | 107 Replies | Last: 12 days ago by aggiebq03+
Ghost of Bisbee
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AG
TexAgs, need some opinions on this real situation. Asking for a friend!

Here's the scenario:

- buyer and seller go under active contract on a home

- seller bought home within last 3 years and has no inspection included on seller disclosure

- buyer has an option period with inspection contingency in contract and is currently in their option period doing inspections

- buyer hires home inspector, receives report, and finds some serious enough evidence of things needing repairs

- buyer has buyer agent send full inspection report to listing agent via email so they understand to be expecting a followup contract amendment

- listing agent responds to buyer agent in writing saying they decline to open the email/report lol

- buyer considering requesting option period extension for more time to conduct due diligence

- listing agent, after communicating they decline to open the email with the buyer inspection report, starts advertising an open house on the property to be held during the option period while the home is active under contract

So, here's the choose your own adventure:
If you're in the buyer's shoes, what's your next step strategy?
If you're in the seller's shoes, what's your next step strategy?
Aggiemike96
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What's the issue here? Seems like a normal course of events for transacting a house.
highpriorityag
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Seller won't open email I assume so they don't have to disclose the report to the next buyer.

As a buyer I would ask for $ discount "based on inspection report", final
offer, you have 24 hours.


I can't speak for sellers next move because I'm not a shady pos with a pos realtor.

I would also keep looking for another home.
Red Pear Realty
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Doesn't really matter if they open the email or not. They've been provided with the information and if you back out, they have to disclose known deficiencies to potential buyers in the future.
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Red Pear Realty
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And to answer your question, the seller and/or their agent have exposed themselves as liars. I really don't like doing business with liars so unless there is some sort of overwhelming reason to continue the transaction (you're getting the deal of a lifetime), I would personally back out solely based on that principal of the matter. I would also also send the inspection report with the termination docs and tell them in writing that if they don't update their sellers disclosure and disclose the information to new potential buyers that I will turn them into the local, state, and national board of realtors as well as TREC.
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Bill Robbins
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The Buyer should assume that the property is being sold "As-Is" and should make their decision based on no repairs will be made.

Heineken-Ashi
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What Jamie said. And actually do it. People like this not getting reported only emboldens them to continue shady practices.
Furlock Bones
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It's a very common thing these days for the sellers to not "receive" the report.
Diggity
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so many crappy agents think that "refusing to open" an inspection absolves them of any responsibility/liability. Not sure how that idea permeated.

In any case, Jamie is correct, they would have an obligation to disclose any material defects, once received.

https://www.texasrealestate.com/members/posts/can-a-seller-or-listing-agent-refuse-to-receive-the-inspection-report/
Omperlodge
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I think the law went too far. I was involved in the other side of a deal like this one. The buyer was an investor so he brought in his inspector to pretty much condemn the house. They played the same game. You are now going to have to disclose this inspection for the next 5 years. Deal gets cancelled. I have to get 10 experts to come out to address each item on the report. Then we provided the report with all the back up disputing it. The experts were pretty clear that none of it was valid.

The law should have been that any report ordered by the seller to be disclosed. I would even like to see some kind of carfax for homes.
Diggity
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You can definitely get buyers that "weaponize" the inspection report. I just had this when selling my parents place.

I think getting another inspection that refutes the findings would be sufficient, but I'm not a lawyer. Always better to over disclose than the alternative.

Any smart buyer will get their own inspection, and they can decide what to ask for (or not).
HomeFinderCody
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There's nothing out of the ordinary with the sequence of events.

Listing Agent, as stated above, cannot "refuse to open" report. The agent not knowing this is one of the reasons my business and people in it get a bad name. Makes me crazy.

The Seller should evaluate any requested repairs. Make a decision of what is reasonable, if anything. Negotiate (another reason you need a good agent). If you cannot find a mutually acceptable solution, Buyer has the right to terminate (keep in mind....many buyers will ask for the moon, threaten to walk away, then not terminate at all).

The thing that typically causes this process to get stressful is the parties (including agents) getting emotional about it. Remember, this is a business transaction (a large financial one). Good agents will help keep emotions out of it.

Best of luck!
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htxag09
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Maybe just semantics, but I don't think the law requires you to provide all inspection reports. That's per Texas REALTORS and their form which goes further than state laws.

Now, who knows what liability you have if you withhold that inspection report and things on it come out after someone buys it....Which is probably why they do it, just a CYA
Diggity
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the law requires you to disclose material defects.

the sellers disclosure is the most common way to communicate those, but if you fail to disclose in some manner, you're definitely opening yourself up to legal liability.
htxag09
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Diggity said:

the law requires you to disclose material defects.

the sellers disclosure is the most common way to communicate those, but if you fail to disclose in same manner, you're definitely opening yourself up to legal liability.
Absolutely. Why I mentioned it's semantics and not doing so would open liability. But the poster claimed the law went too far and then said they'd have to provide that inspection report for 5 years. The law doesn't require you to provide all previous inspection reports....to my knowledge, but it's easy CYA.
Diggity
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gotcha. You're correct.

To take it a step further, you can do a listing or purchase agreement on a napkin, as long as you have all the necessary terms and consideration.

Most of those forms are a form of CYA to make sure terms are defined up front and people aren't committing fraud (knowingly or unknowingly).
CS78
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Diggity said:

You can definitely get buyers that "weaponize" the inspection report.


Yeah, like 90% of buyers and agents. Seems like once a month we get this thread from a pissed buyer because the seller refuses to play their game. It's an option period. You probably paid next to nothing, to tie up someone's house for 10 days. Make your decision to buy or not. That's what you paid for.

The best are these agents that are begging you to take their clients offer, then a week later, trashing your house like it should be condemned. That's what gives agents a bad name.

I've just started putting everything on the sellers disclosure. Roof has damage, AC is old, water heater leaks. It's really simplified the bull poop.
Dan Scott
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This is perfect example of why seller should provide inspection upfront. Buyer can then make an educated offer and limit this bullcrap. Buyer cab then go do hit own inspection if he wants but shouldn't find anything too major in his report vs the seller
Diggity
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More information is always a good thing, but I don't think that really solves the problem.

Just like shady real estate agents, there are enough shady inspectors out there that I would have a tough time just accepting the word of whoever the seller picked.

If it were a known quantity, that would be one thing, but that's not usually the case.

You want your inspector working for you. The nuance of what the real issues are is lost when looking at a previous report.
SweaterVest
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Only one real option here…

Bring dozens of copies of the inspection to the open house. Mix some in with the listing flyers, drop some around the bedrooms, bathrooms, you get the picture…
SteveBott
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Now your thinking like an OB poster. Well done.
SteveBott
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Oh and add some Tannerite explosives to mix and you get in the hall fame on OB.
P.H. Dexippus
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OP, did we come across the same seller's agent?
https://texags.com/forums/59/topics/3472381/replies/67981762#67981762

Absolute
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As an inspector and realtor, one part of the listed sequence strikes me as a little odd and unnecessarily passive aggressive. That is the line about emailing the full report so the seller knows a request is coming prior to sending the amendment. Did I read it wrong? Why? What's the point? What's the benefit to the negotiations?

All the professionals involved, even bad ones, should know that a repair amendment is going to be coming from the inspection. They should explain that to their clients. Sending the report that way serves no real purpose to the negotiating process that I can see. The buyer and their agent should review the report and decide what they want to do. Ask for repairs, ask for concessions, both. Then send the related support from the report with the amendment. At the end of the day, it is just another part of the negotiation and being passive agresive about it doesn't really help anyone's position.

As to the whole disclosure discussion. I have been involved with dozens of situations over the years where my inspections findings ended up concerning the client enough that they walked, or they just could not get negotiated. In some cases there were truly dangerous or health related concerns and it bothers me to think that it might not get disclosed or found by the next inspector. But ultimately it is not my job, or a buyer whom walked job to police this. If you end up walking why do you really care? Yes, they should be ethical and moral and do the right thing and disclose the stuff and how it was fixed. But do we realistically think that happens much in today's society?

Everyone in the real estate world knows this doesn't happen. Right or wrong it is considered common courtesy and practice to not send the full report. Honestly, not everything in the report should be sent. Some things are informational, some are maintenance, every client has different things that concern them. Asking for everything in the report isn't very realistic, except in new construction.

From the inspectors point of view, anyone other than the party that paid me relying on the report in any way is specific disallowed. I won't even talk to someone else about it. And I do occasionally get calls like that. This is also why I don't like listing inspections, I would be working for the seller only and the report specifically says no one else can use it. This is also why I don't like the four year report disclosure rule that much. Too much Changes in four years. The report isn't good for much at that point other than providing a little bit of documentation on the history of things.
Deats99
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As one of Absolute's most loyal agents, I think he does a crazy good job. With that said I would never send over the whole report unrequested. That is just amateur hour and a quick way to poison your local market. Mr Absolute can correct me but I do not know what right of dissemination you have in most cases.
A good plan violently executed now is better than a perfect plan executed next week.
-George S Patton
Red Pear Realty
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If hiding the truth is the only way to be friends, I don't want to be your friend.
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Yesterday
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So for the record is there a law requiring a seller to view an inspection report?
Deats99
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Red Pear Realty said:

If hiding the truth is the only way to be friends, I don't want to be your friend.

Don't be an idiot. WTF are you talking about? I don't hide **** from anyone. I send report material on only the repairs requested. Why do I want to crap all over a listing we may not close on? I am not here to protect future buyers, only negotiate the best, cleanest deal possible for my client.
A good plan violently executed now is better than a perfect plan executed next week.
-George S Patton
Deats99
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Yesterday said:

So for the record is there a law requiring a seller to view an inspection report?

If it is received, even unopened, you must disclose anything on it unless factually disproven.
A good plan violently executed now is better than a perfect plan executed next week.
-George S Patton
Yesterday
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Deats99 said:

Yesterday said:

So for the record is there a law requiring a seller to view an inspection report?

If it is received, even unopened, you must disclose anything on it unless factually disproven.


I'm assuming you have to disclose there was an inspection and give said inspection to whomever wants it? How does one disclose defects if one doesn't read it? Honestly asking. Not trying to argue.
Red Pear Realty
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See the link posted above from TAR. Sticking your hands over your eyes and not reading a report you've received doesn't absolve you from your legal responsibilities. The courts will not think it's cute and agents and their clients will be held responsible. It's a dangerous game being played by ignorant agents who probably shouldn't even be agents in the first place.
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Deats99
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Yesterday said:

Deats99 said:

Yesterday said:

So for the record is there a law requiring a seller to view an inspection report?

If it is received, even unopened, you must disclose anything on it unless factually disproven.


I'm assuming you have to disclose there was an inspection and give said inspection to whomever wants it? How does one disclose defects if one doesn't read it? Honestly asking. Not trying to argue.


So would you want to sit in front of a judge once you had been disposed and it was shown to have been delivered to your inbox?
"I didn't open the email so I didn't get it!"
A good plan violently executed now is better than a perfect plan executed next week.
-George S Patton
Red Pear Realty
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Playing peek a boo with an inspection report doesn't make one some wizard agent, it shows who they really are. I get to do a lot of deals with a wide berth of price points around Texas. The real "professional" agents who are doing dozens of deals and who are working bigger transactions aren't doing this. It's the goobers with Gmail email addresses running around with glamour shot photos who are happy to do a deal this year and probably shouldn't be agents in the first place.
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Yesterday
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In this hypothetical I would say, "I did not read it."

Again, I'm not doing anything. I want to know what the law is.

Does the law require and agent to read an inspection report?
Mas89
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I understand your question as I delete 99 percent of emails without opening.
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