I spoke with my escrow officer today to see if the closing, which is scheduled for Monday, is on track. Unfortunately, his response was a bit disappointing. He said the file was on his desk and he was planning on starting work on it in a day or two. This is what I hate about title companies. They've had this file for three weeks and they haven't done a thing with it yet. What will happen is they will suddenly need stuff done at the last minute and the buyer and seller will have to scramble like crazy. But the good news is I know to expect this now and shouldn't get too stressed out when it happens. The only problem here is I will be out of town on Monday, so I need to get my signing done before then. I told this to the escrow officer, who originally wanted me to come in on Friday, and he said he'd give me a call tomorrow to set up an earlier signing time.
I was hoping to learn something about the loan status of the buyer, but haven't heard anything on that. I'll need to talk to my agent. We also need to put the lower appraisal-based purchase price in writing.
I also stopped by the property on the way in to work this morning and was pleased to see the place is still standing :-) No more break-ins or vandalism, either. Hopefully, this will continue until at least right after escrow closes.
House 3: Increased Police Patrols
I called the police department today and spoke with an officer in the Community Response Office and told them what has been going on at my property. They filed a request for increased patrols in the area. This doesn't mean they will guarantee increased patrols, but it does mean that whenever the police have some extra time, they are supposed to spend it patrolling the neighborhood. Hopefully, that will help cut down on the crime.
House 3: Can't Get Rid Of It Fast Enough
My handyman called me Sunday afternoon. This was not a good sign, since he was finished repairing the window and back door on Friday. He was in the neighborhood and drove by the house just to check it out and he saw someone had pulled out the window air conditioner unit from the converted carport. He said it didn't look like they broke into the house, but just pulled it out from outside. He's stopping by today (Monday) to board up the hole and, the day escrow closes, he'll put a new unit in. No sense in putting another one in now, just to have it get stolen again.
In the meantime, I'm going to buy a couple cheap lamps and some timers and put those in the house to at least give the impression someone is living there. If all goes well, I'll only have this place for 2 more weeks, so I just need to hold the thieves at bay until then. Of course, I don't think there is anything left to steal, so now it's just vandalism I'm worried about.
I'm also going to call the police department and ask for increased patrols in the neighborhood.
In the meantime, I'm going to buy a couple cheap lamps and some timers and put those in the house to at least give the impression someone is living there. If all goes well, I'll only have this place for 2 more weeks, so I just need to hold the thieves at bay until then. Of course, I don't think there is anything left to steal, so now it's just vandalism I'm worried about.
I'm also going to call the police department and ask for increased patrols in the neighborhood.
House 3: Burgled Again!
My agent called me yesterday with the results of the buyer's inspection. The buyer basically faxed over the inspector's report and wants everything fixed. That's not going to happen. But the scarier news was the inspector called and told us the house had been broken into. They only stole the new stove that I just put in - that's about all that is in the house anyway. That by itself isn't a big deal. What scared the crap out of me however, was what else the inspector told us: whoever stole the stove, turned on the gas outlet and left it open! The place smelled of gas when the inspector showed up. I am incredibly lucky I still have a house to sell.. Thankfully, the last time I was there, I turned off the pilot lights on the two gas wall heaters - one of which is on the opposite side of the wall from the gas outlet. The water heater pilot light was still burning, but the inspector said there was inadequate ventilation in the water heater cabinet and that actually kept the gas out. The thieves got in through the back door at the laundry room by kicking it in. The inspector shut off the gas and locked the place up the best he could.
I checked it out this morning and it was not as bad as I feared. The stove was gone and the back door was kicked in, but the door itself appears fine. The door jamb is splintered and that will need to be replaced. No gas smell was present, but I turned off the pilot light on the water heater, just to be safe.
Now, on to the list of stuff the buyer wants fixed:
The roof shows signs of unprofessional repair and cracking. It shows exposed nails and is missing some drip edge flashing on one side. In addition to getting these things fixed, the buyer wants a roof certification.
The plumbing is mixed copper and galvanized pipes. The water heater had corrosion on pipes and valves. The TPR overflow pipe did not extend to a safe location outside. (Deja vu - this is very similar to a problem I had with the heat pump condesate drip pipe on the first house I sold.) Two supply pipes were not clamped to the wall.
Two rooms did not have cooling or heating at time of inspection. (Meaning there are no vents in those rooms, not that the airflow into those rooms is blocked.) The evap unit only worked at the high cool setting.
The main power lines to the building are in contact with tree limbs - contact the utility company to fix. The GFCI outlet and kitchen did not test properly. The conduit at the main panel is not clamped to the wall. Three pronged outlets did not test as properly grounded.
There was broken glass at one bedroom window. Bathroom door jamb had damage. The room laundry room door jamb was damaged. The rear sliding door dual pane only has one pane. The back windows at the room addition were missing latches.
The laundry sink faucet leaked. The dryer vent was damaged.
The kitchen cabinet doors have damage.
Some of this stuff is the most ticky-tack stuff I've seen. For instance, the kitchen cabinet doors. All I can see is one door that has some wood chips out of it. However, this was painted over and it was in this condition when the house was for sale. And the reason there was glass at a bedroom window is because someone threw a rock through it. Yet, the report does not mention the hole in the window!
Anyway, the buyer is cash poor - hence the 100% loan to purchase and the 3% seller's contribution he wants from me so he can pay his mortgage broker and others involved in the process. I did a recorded documents search on the buyer and came up with nothing, so I don't have much info about him. However, he is obviously cash poor, so I instructed my agent to make the following offer: I will fix the back door jamb and the broken window. I will give the buyer $350 at closing for a new stove. I will also give the buyer $3,000 at closing to fix everything else. I'm hoping this guy will realize he can do the work himself and pocket a nice chunk of change. We're presenting this offer verbally first, to see if it will fly. If it does, we'll write it up. If not, I'll submit a list of things I will and won't fix.
This will probably be the last time I buy in a lower income part of town.
I checked it out this morning and it was not as bad as I feared. The stove was gone and the back door was kicked in, but the door itself appears fine. The door jamb is splintered and that will need to be replaced. No gas smell was present, but I turned off the pilot light on the water heater, just to be safe.
Now, on to the list of stuff the buyer wants fixed:
The roof shows signs of unprofessional repair and cracking. It shows exposed nails and is missing some drip edge flashing on one side. In addition to getting these things fixed, the buyer wants a roof certification.
The plumbing is mixed copper and galvanized pipes. The water heater had corrosion on pipes and valves. The TPR overflow pipe did not extend to a safe location outside. (Deja vu - this is very similar to a problem I had with the heat pump condesate drip pipe on the first house I sold.) Two supply pipes were not clamped to the wall.
Two rooms did not have cooling or heating at time of inspection. (Meaning there are no vents in those rooms, not that the airflow into those rooms is blocked.) The evap unit only worked at the high cool setting.
The main power lines to the building are in contact with tree limbs - contact the utility company to fix. The GFCI outlet and kitchen did not test properly. The conduit at the main panel is not clamped to the wall. Three pronged outlets did not test as properly grounded.
There was broken glass at one bedroom window. Bathroom door jamb had damage. The room laundry room door jamb was damaged. The rear sliding door dual pane only has one pane. The back windows at the room addition were missing latches.
The laundry sink faucet leaked. The dryer vent was damaged.
The kitchen cabinet doors have damage.
Some of this stuff is the most ticky-tack stuff I've seen. For instance, the kitchen cabinet doors. All I can see is one door that has some wood chips out of it. However, this was painted over and it was in this condition when the house was for sale. And the reason there was glass at a bedroom window is because someone threw a rock through it. Yet, the report does not mention the hole in the window!
Anyway, the buyer is cash poor - hence the 100% loan to purchase and the 3% seller's contribution he wants from me so he can pay his mortgage broker and others involved in the process. I did a recorded documents search on the buyer and came up with nothing, so I don't have much info about him. However, he is obviously cash poor, so I instructed my agent to make the following offer: I will fix the back door jamb and the broken window. I will give the buyer $350 at closing for a new stove. I will also give the buyer $3,000 at closing to fix everything else. I'm hoping this guy will realize he can do the work himself and pocket a nice chunk of change. We're presenting this offer verbally first, to see if it will fly. If it does, we'll write it up. If not, I'll submit a list of things I will and won't fix.
This will probably be the last time I buy in a lower income part of town.
House 3: May Fall Through (Updated)
I just found out that the buyer's lender found out this property was a flip and they want an addendum to the contract. The addendum states that I will sell the house for whatever the appraisal comes back at (or $205,000, whichever is less) AND I will still contribute 3% of the price.
There is no way any seller in their right mind would agree to this. Suppose the appraisal comes back at $175,000? I'm not going to agree to sell the property for an unknown amount determined by some stranger that is paid by the buyer. That conflict of interest seems pretty clear to me. My agent thinks the buyers will have to back out if I don't agree, but so be it. I rejected the addendum and my agent is moving the listing status back to active.
Update: Things are changing by the minute. My agent talked with her broker about this addendum and we all agree it's poorly written and there is no real need for it. The addendum actually states that if the appraisal comes back for less, than I will still contribute 3% towards the selling price. It doesn't actually specify a selling price and leaves things very vague about what happens should the appraisal not match the selling price. But this is unnecessary because the standard sales contract already includes a clause where if the appraisal doesn't match the sales price, the parties can renegotiate or cancel the sale.
How funny! I just got another call. Turns out, the buyer's agent didn't know that the standard sales contract was contingent on the appraisal! They are happy with that and are ordering the appraisal now and are moving forward without the addendum. I asked if this was a new agent and my agent said it was. And it was the buyer's mortgage broker that asked for the addendum to be written in the first place. So it appears we were just dealing with some uninformed people. Once things were explained, the problem went away.
There is no way any seller in their right mind would agree to this. Suppose the appraisal comes back at $175,000? I'm not going to agree to sell the property for an unknown amount determined by some stranger that is paid by the buyer. That conflict of interest seems pretty clear to me. My agent thinks the buyers will have to back out if I don't agree, but so be it. I rejected the addendum and my agent is moving the listing status back to active.
Update: Things are changing by the minute. My agent talked with her broker about this addendum and we all agree it's poorly written and there is no real need for it. The addendum actually states that if the appraisal comes back for less, than I will still contribute 3% towards the selling price. It doesn't actually specify a selling price and leaves things very vague about what happens should the appraisal not match the selling price. But this is unnecessary because the standard sales contract already includes a clause where if the appraisal doesn't match the sales price, the parties can renegotiate or cancel the sale.
How funny! I just got another call. Turns out, the buyer's agent didn't know that the standard sales contract was contingent on the appraisal! They are happy with that and are ordering the appraisal now and are moving forward without the addendum. I asked if this was a new agent and my agent said it was. And it was the buyer's mortgage broker that asked for the addendum to be written in the first place. So it appears we were just dealing with some uninformed people. Once things were explained, the problem went away.
