Buyer backing out of no contingency contract

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Agent again.

I was afraid that what you stated as a conclusion is true: Contracts do mean nothing.

It's complete bullshit.

No, contracts do mean something, but not everything. The sellers did get $2K--as stated in the contract. If contracts meant nothing, the sellers would have gotten nothing. In this case, the agent f-ed up and should have demanded a higher earnest. And if the agent told you that $2K in the DC metro area is standard, your agent is lying. In hot markets (we live in CC DC), it's not unheard of to hear of 10% EMDs on homes that are up for bidding wars. These are homes in the $750K+ range, so EMDs are upwards of $70K. Now, that is some serious change that buyers will NOT walk away from.

OP might consider a new realtor.

I know it's necessary in some markets, but I could never put that kind of money down. Unanticipated things can happen, that could financially cripple some people.

Can't you just roll the EMD into the downpayment for the loan at closing? If so, why is 10% now instead of 10% at closing (say in 30 days) such a big deal?

Because this buyer obviously wants to have it both ways and be able to jump out if needed.

PP here. I'm not saying I want to breach the contract. I'm saying that things happen. Suppose I get in a horrible car accident and can no longer purchase the house. If all contingencies are removed, then I lose the EMD. I think it's acceptable to lose 10,000 to 30,000 bucks to make up for the seller having to take their house off the market, but 75-100K? That wildly exceeds any damages the seller could possibly incur, especially in the type of market that would require that type of deposit. In my above example, I now am in the hospital and out six figures.
People always give sob stories I know, and a contract is a contract. All I said is I would never sign a contract that left me with that type of exposure, because I realize that unexpected things can happen. If I lose out on the hottest houses, so be it.
Sometimes you have to get out of a contract. You shouldn't sign one in which the terms of getting out will financially ruin you.

Yes, that is a risk one would take. But, there are risks to everything. Also, I think that many (though not all) sellers would not take the EMD if something truly tragic happened before closing. I know that my husband and I would not. Of course, we would want to verify the accident and all, but upon proof, I think that we would just move on to new buyers.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:In this area, $2K is a pretty normal deposit sum for a house with a price tag of $390K. It's really not normal to put down large deposits in this area, although that may change if buyers start flaking on a regular basis.

Umm, no it is not. We sold our place in the low $200K range. We had two offers, one with earnest money of $5K and one with $10K.

$2k EMD sounds pretty normal. We had a seller that wanted $10k EMD because they had two prior buyers to walk and we declined. They did eventually sell but at a much lower sales price. I would never put down 10k EMD unless I really, really wanted a house. We bought a $250k property and only put down $1k EMD.

We put down $3k EMD for a house listed at $440k. I don't think $2k was too low -- I just think these particular buyers were yucky awful people who broke the contract, broke their word, and have no integrity.

[Anonymous]

We just recently had buyers walk away from a sale over a few very minor, easily fixable home inspection items. I think it was an excuse and they found a house they liked better. If people are going to walk away, they will find a way to get out and there is really nothing a seller can do about it.