Seller breach of contract on home. I need advice.

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
1130Super
Posts: 523
Joined: Thu Nov 07, 2019 8:59 am
Location: Minnesota

Re: Seller breach of contract on home. I need advise.

Post by 1130Super »

Bcoleman7506 wrote: Fri Jun 05, 2020 2:25 pm [quote

If that is the case, and if you did not specify a specific type of repair my thought is that the seller has done his job. Better to spend a bit more time figuring this out before you It is an investment property so we played hard ball throughout the process. We got $10k off the initial asking price, quite a few repairs, and some extra cash for more repairs. I think we’ve done well so I think pushing it at this point may be unnecessary. Just was curious what the consensus was with some unbiased opinions.
If I was the seller I’d try and walk away
JGoneRiding
Posts: 1970
Joined: Tue Jul 15, 2014 3:26 pm

Re: Seller breach of contract on home. I need advise.

Post by JGoneRiding »

quantAndHold wrote: Fri Jun 05, 2020 2:59 pm What does your realtor say? You have a professional handling things, right?

A seller who’s willing to bail over a $3500 difference either knows they can quickly sell it to someone else, or they’re so sick of trying to deal with a difficult buyer that they’re willing to take the risk of relisting.

I think at this point, either go through with the sale and fix it yourself, or find another place.

Edit...lots of older houses have ungrounded, two prong outlets. Asking for the seller to upgrade them isn’t really a normal part of most real estate transactions.
From the sellers point of view its NOT $3500 it's more like 30k from what op said in price reduction and multiple repairs. At this point op needs to take it or accept they are not going to get it to closing
criticalmass
Posts: 1615
Joined: Wed Feb 12, 2014 10:58 pm

Re: Seller breach of contract on home. I need advise.

Post by criticalmass »

Bcoleman7506 wrote: Fri Jun 05, 2020 2:25 pm

Thanks for all the replies. We specifically stated in the contract “ground upstairs wiring.” Not “bring upstairs electrical to code.” What they did was exactly that though, they brought it up to code yesterday but did not ground it.

The purchase price was $290,000, it appraised at $306k so I’m not trying to be an a-hole but at the same time, I’m the type of person who believes if you sign your name on the dotted line, you do the work.

I think we’re going to concede that they just run a dedicated 3 prong receptacle upstairs and be done with it. It just angers me quite a bit, and there’s a very long backstory. They’ve consistently weaseled out of things, and also listed the home 400 square ft over what the appraisal came back with (20% of the home).

It is an investment property so we played hard ball throughout the process. We got $10k off the initial asking price, quite a few repairs, and some extra cash for more repairs. I think we’ve done well so I think pushing it at this point may be unnecessary. Just was curious what the consensus was with some unbiased opinions.
You say you are playing hardball. They can play the same game with you, as your actions are likely strongly encouraging them to do so. You say you want the other party to “ground upstairs wiring” Modern code allows GFCI to provide protection similar to a third wire ground, as long as there is a neutral wire, which IS bonded to ground on your premises. Check current NEC as implemented in your locality for details. Asking a seller to provide an Upgrade, e.g. new wiring is a bit of a stretch in a home purchase, unless there is nobody around who they could possibly sell to instead. Consider finding a different home that does not need such upgrades at your request if you are unwilling to do them. Your actions as described may seller to walk away and may suggest you aren’t serious about this purchase without causing them massive additional headache. They likely have their own schedule and would like to find a new course of action that does include dealing with similar demands.
Last edited by criticalmass on Sat Jun 06, 2020 12:36 pm, edited 1 time in total.
criticalmass
Posts: 1615
Joined: Wed Feb 12, 2014 10:58 pm

Re: Seller breach of contract on home. I need advise.

Post by criticalmass »

vtjon02 wrote: Fri Jun 05, 2020 1:36 pm
7eight9 wrote: Fri Jun 05, 2020 1:21 pm If you want to force the sale the key words are specific performance (https://en.wikipedia.org/wiki/Specific_performance). You will likely need to hire an attorney.
Good luck, there are way too many ways for both buyers and sellers to get out of contracts. You will also nearly always not be able to enforce the sale but rather get some kind of monetary compensation.

What makes real estate transactions work is when both parties have a mutual goal, move the property from seller to buyer.

When I sold a home many years ago the buyers were walking all over us and my realtor was useless. Fixed something, then fixed something else, then complaint then complaint then complaint. The realtor kept telling me to accept it, then accept it then give in more. I finally said that I was done making repairs and that no further action would be taken. That they could buy as it was or move on. WE closed a few weeks later. Was very stressful.

From the seller's perspective it may not be worth it to go through with the transaction to keep you happy. I don't know if that is the case but if you want the house try to be reasonable and work with the seller to come to a mutually beneficial solution. If they will give you a concession, great. But you'll have to ask yourself if you want to move on or deal with it. Just make a decision and stick with it.

This isn't about winning the argument and having them honor what they said.
That experience enumerates Rule #1 for commissioned sale real estate agents. They exist to get their commission and move on to their next commission. Telling you as a seller to accept something not in your interest helps move them along in applying Rule #1.
criticalmass
Posts: 1615
Joined: Wed Feb 12, 2014 10:58 pm

Re: Seller breach of contract on home. I need advise.

Post by criticalmass »

F150HD wrote: Fri Jun 05, 2020 10:47 pm
Ping Pong wrote: Fri Jun 05, 2020 9:50 pm What do you plan on plugging into the outlet that requires a 3 prong connector? With the advent of plastic, most things only require a 2 prong outlet nowadays.
I have heard some insurers wont insure a home that does not have grounded outlets.

any surge protector for a HDTV will require a grounded 3 prong outlet.

The charging cord for my mac laptop has 3 prongs.

etc
Solution: Check the NEC and local adaptation for this very scenario.Install GFCI outlet(s). Receive local inspection. Plug in your three prong cords into your new GFCI outlets. Voila, safe and effective.
spectec
Posts: 1564
Joined: Mon Jul 14, 2014 8:00 am

Re: Seller breach of contract on home. I need advice.

Post by spectec »

Don't remember where I first heard this:
"Two honorable people doing business with one another don't need a contract. But that's why we need contracts."
Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it. - Will Rogers
rich126
Posts: 2009
Joined: Thu Mar 01, 2018 4:56 pm

Re: Seller breach of contract on home. I need advice.

Post by rich126 »

In general I have found some people think buying an older home should be the same as a new home. In my case I was selling a 40+ year old home in good shape but certainly not new. The buyers wanted me to replace the hvac since it was old but it functioned fine and it worked except for replacing the capacitors the whole time I owned it. Maybe it would break next week or work another 10 years.

You can ask for anything but people can refuse or even change their minds. You can sue at times but suing for principle can often be costly. If they won’t do what you want then walk away. I told my buyers no to their final offer and then they upped it. Nothing is done until papers are signed and the deal is done.
spectec
Posts: 1564
Joined: Mon Jul 14, 2014 8:00 am

Re: Seller breach of contract on home. I need advice.

Post by spectec »

"Nothing is done until all the checks have cleared the bank."
Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it. - Will Rogers
niagara_guy
Posts: 25
Joined: Tue Feb 11, 2020 8:32 am

Re: Seller breach of contract on home. I need advice.

Post by niagara_guy »

I had a similar issue a long time ago. Seller signed contract that said they had to fix all issues to bring house up to city code. They refused after finding out the cost. My real estate agent/broker said seller would have to pay the commission if they backed out, so they eventually fixed plumbing issue before sale, since commission was about the same amount as fixing the issue.
Lee_WSP
Posts: 3252
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Seller breach of contract on home. I need advice.

Post by Lee_WSP »

You are the one holding up the sale. You can either agree to walk away or take it as repaired.

You found an issue that entitles you to walk away. They agreed to fix, they did, you aren't happy. Either go through with it or not.

The inspection period is to protect you, the buyer, from undisclosed/unknown repairs. It gives you, the buyer, the right to terminate the contract if undisclosed issues are discovered when given the opportunity to inspect. If you the buyer, choose not to go through with it, it is actually you, the buyer, who is in breach, but since it is now an excusable breach, you should be able to get your deposit back.

The seller is actually not in breach. You two agreed that seller would have an opportunity to fix it, seller did, now you can take it or walk away. Even if seller didn't even attempt to fix it, you'd still be faced with the same option.
Last edited by Lee_WSP on Mon Jun 08, 2020 4:11 pm, edited 1 time in total.
Dave55
Posts: 794
Joined: Tue Sep 03, 2013 2:51 pm

Re: Seller breach of contract on home. I need advice.

Post by Dave55 »

spectec wrote: Sun Jun 07, 2020 6:17 pm "Nothing is done until all the checks have cleared the bank."
A business colleague used to say: "It isn't a done deal until I spent the money".

Dave
wfrobinette
Posts: 1343
Joined: Fri Feb 20, 2015 3:14 pm

Re: Seller breach of contract on home. I need advice.

Post by wfrobinette »

Bcoleman7506 wrote: Fri Jun 05, 2020 1:12 pm Went into a contract with a seller of a home. We asked for grounding of upstairs electric as it is only a two prong electrical system. Sellers agreed and signed contract.

Upon follow up inspection the sellers did not ground the electric upstairs. They then tried to pass off running a ground wire from a GFCI plug, which we had a master electrician go out and came back saying that does not ground the wire properly.

The sellers are now saying they plan to breach the contract and not go through with sale. What would you recommend I do here? I want the home, but if I buy it, I would have to install approx ~$3,500 worth of electrical work that the sellers are refusing to do, even though they signed the contract stating they would. Need advise.
Either buy it or walk away. It's that simple.

I had a friend that sued after the closing due to disclosure fraud(50k to repair) and it took him 2 years and after all legal fees he netted 12 grand.
wilked
Posts: 1782
Joined: Thu Mar 24, 2011 1:50 pm

Re: Seller breach of contract on home. I need advice.

Post by wilked »

“Well done is better than well said”

-Franklin
jharkin
Posts: 2596
Joined: Mon Mar 28, 2016 7:14 am
Location: Boston suburbs

Re: Seller breach of contract on home. I need advice.

Post by jharkin »

Bcoleman7506 wrote: Fri Jun 05, 2020 1:12 pm Went into a contract with a seller of a home. We asked for grounding of upstairs electric as it is only a two prong electrical system. Sellers agreed and signed contract.

Upon follow up inspection the sellers did not ground the electric upstairs. They then tried to pass off running a ground wire from a GFCI plug, which we had a master electrician go out and came back saying that does not ground the wire properly.

The sellers are now saying they plan to breach the contract and not go through with sale. What would you recommend I do here? I want the home, but if I buy it, I would have to install approx ~$3,500 worth of electrical work that the sellers are refusing to do, even though they signed the contract stating they would. Need advise.
Tread carefully here.

What they did, while maybe not what you exactly agreed to - IS code legal in most jurisdictions, and is the solution most electricians will recommend to you if the alternative means tearing up walls to pull all new wire from the service panel. Its actually quite safe, as the GFCI senses any short more than a few milliamps and will trip on faults that even a traditional grounded circuit wont.

Further, if you have no need to use any 3 pronged equipment on a particular receptacle, simply leaving it as a 2 prong is also safe.

1996 NEC
210-7

(d) Replacements. Replacement of receptacles shall comply with (I). (2). and (3) below as applicable.


(1) Where a grounding means exists in the receptacle enclosure or a grounding conductor is installed in accordance with Section 250-50(b), Exception, grounding-type receptacles shall be used and shall be connected to wire grounding conductor in accordance with Section 210-7(c) or Section 250-50(b). Exception.


(2) Ground-fault circuit-interrupter protected receptacles shall be provided where replacements are made at receptacle outlets that are required to be so protected elsewhere in this Code.

(3) Where a grounding means does not exist in the receptacle enclosure, the installation shall comply with a. b. ore below:

a. A non-grounding-type receptacle(s) shall be permitted to be replaced with another non-grounding-type receptacle(s).


b. A non-grounding-type receptacles) shall be permitted to be replaced with a ground-fault circuit-interrupter-type of receptacle(s). These receptacles shall be marked “No Equipment Ground." An equipment grounding conductor shall not be connected from the ground-fault circuit-interrupter-type receptacle to any outlet supplied from the ground-fault circuit-interrupter receptacle.

c. A non-grounding-type receptacle(s) shall be permitted to be replaced with a grounding-type receptacle(s) where supplied through a ground-fault circuit-interrupter. Grounding-type

receptacles supplied through the ground-fault circuit-interrupter shall be marked “GFCI Protected" and “No Equipment Ground." An equipment grounding conductor shall not be connected between the grounding-type receptacles.


So I would think about what you want to do. If your written contract with them says something vague like "bring the 2 prong outlets up to code" I don't think you have any basis to challnege it. If its specifically stated, in writing "replace all ungrounded outlet circuits with new 3 wire (2 conductor+ ground NM-B) grounded circuits run directly from the service entrance panel" then yes they are in breach- but it depends how much of a legal fight you want to put up with.
Lee_WSP
Posts: 3252
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Seller breach of contract on home. I need advice.

Post by Lee_WSP »

If seller is in breach of the repair, all it means is buyer gets to walk and gets deposit back.
Post Reply