I've heard many buyers say they can "save money" by not using a Realtor. Many of them are first time buyers who have never seen a purchase contract, let alone gone through escrow, reviewed title, procured financing, etc.
Read a quick Q&A on a recent transaction below, and see if you're comfortable dealing with these kinds of contingencies and timelines on your own. Are you ok with your thousands of dollars in earnest money being on the line by missing just one of the many timelines in the contract? When you go into a transaction on your own, you most likely won't understand any of these requirements for meeting the terms of your contract - but the Seller's Realtor will. Good luck.
(From Washington Realtor Hotline Attorney Annie Fitzsimmons):
Situation:
Buyer and seller used the statewide purchase agreement with financing and inspection contingency addenda. Buyer timely submitted a work order request under the inspection contingency on Saturday, April 4 and seller never responded. Seven days later, on Saturday, April 11, buyer terminated the purchase agreement. Seller claimed the termination was untimely. Because seller refused to make repairs, buyer's lender declined financing. Seller had never forced buyer to waive the financing contingency. Buyer terminated based on the financing contingency. Is buyer entitled to recover the earnest money? If so, why?
Analysis (if you have an experienced Realtor representing you):
When buyer gave seller a request for repairs under the inspection contingency, seller had three business days to respond. Since the request for repairs was issued on a Saturday, seller's three days to respond did not start to run until Monday the 6th and expired on Wednesday the 8th.
Because seller never responded to buyer's request for repairs, buyer had three business days to terminate the agreement or reach some other agreement with seller. If buyer did neither, buyer's inspection contingency would waive. Buyer's three business days included Thursday the 9th, Friday the 10th and Monday the 13th. Buyer terminated timely on Saturday the 11th.
In addition, because seller never forced buyer to waive the financing contingency, buyer's financing contingency was still in full force and effect. It did not matter how many days had passed since mutual agreement. If seller never forced buyer to waive the financing contingency, the financing contingency was never waived. As a result, when lender declined buyer's financing, buyer was entitled to recover the earnest money, presuming buyer could provide seller with a letter from lender showing timely application, sufficient funds to close the transaction and the reason for denial.
Buyer is entitled to recover the earnest money under either or both the inspection contingency and the financing contingency. If seller refuses to release the earnest money, buyer should be advised to seek legal counsel.
Seattle Realtor, Broker, Agent - Seattle Real Estate
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