Buyer pulling out !

[MissMuffitt]

When we were selling out little house in Nanango to move up here to Gladstone, the lady who was buying our house was waiting for her house to sell, and I think it was another 2 down the link from her... So say 4 people all Dependant on each sale to go ahead for the last one (Us) to finally finish the chain.
I'm glad to say that everything worked out and we all got our new homes, but yes it is not a good feeling knowing that you have all these other contracts that might fall over at any stage...

 

[Dazz]

the basic contract document is a pre-formatted form prescribed by the state govt. there are different companies/solicitors/REIQ etc that have taken the base document and added to it to make it user friendly etc, but in general it is largely the same.

As soon as I hear the words "basic", "typically we do it this way" and "pre-formatted" and "in general" and especially the words "standard contract"......my "I'm getting royally shafted radar" is on full alert.

agents then fill in the blanks

Not with me they don't UC. It happens all the time with newbies, and I laugh every time I hear it. The Vendor's paid agent actually wrote the offer to the Vendor. What a cosy little circle indeed. Meanwhile, the nice innocent little other party to the contract sits their quietly while they get rolled.

# 1 tactic people, rip that pen out of the Agents hand and don't let him go anywhere near your offer. Once you've completed it, crossed out any of the standard clauses you don't like, and submitted extra ones that you require....then and only then execute the deal and have it witnessed by someone other than the Vendor's agent.

I'd strongly suggest not even having the Vendor's agent in the same room when you write your offer. The last thing you need is a paid representative of the other party to the Contract P1ssing in your ear as you write it up.

Although, when I come to sell a property, I would very much encourage my paid representative to write an Offer to me.....and importantly whisper encouraging little sounds into the Buyers ears whilst he's writing my Offer to me....wonderful stuff. I'll ask that he doesn't include (or resists enormously) any clauses that I don't want to see in my Offer to myself.

What a marvellous set up for a Seller.

if not, they right it themselves.

See what I mean, you don't want them "righting" (sic) up your offer.

The document is then signed by the buyer and becomes an "offer". The to and fro then commences until parties agree on terms, conditions and price. Once that happens and both parties have signed, the agent dates it and it becomes a "contract"..

UC, the agent plays absolutely no part in the legality of the paperwork. The agent does not date it. The Vendors and Purchaser's date their signature and have it witnessed by someone not a party to the Contract. The Agent, as always, has absolutely no legal power in the transaction and plays absolutely no part in the proceedings. Typically, they'd like to think that they do, and they put on a marvellous show for all to see.....but they are not needed and do not partake in any of the contractual proceedings at all.

does that make sense???

I simply love that question.....it is loaded with the implication that the person asking the question is a full bottle on the subject matter and the listener is completely clueless.

The way you've written and portrayed it UC.....it makes absolutely no sense whatsoever. I would never do what you prescribe. Anyone who follows that portrayal needs their head read, cos they will have been taken for a huge ride in the negotiation. Great for the Vendor, hopeless for the Buyer.

 

[wylie]

In Urban's defence, there are thousands of contracts that go through without any hassles. Perhaps having a real estate agent in my family has meant that we know what to put in the "standard" contract and what to make sure is crossed out.

The standard contract works well but if I didn't have a family member who knows these things, I would probably have our solicitor look over the contract.

We go in cash unconditional generally having got our finance sorted already, (and we have never had a pest or building inspection - we like to live dangerously - we buy queenslanders and know what to look for) so adding or crossing out clauses is generally not an issue for us, but I agree that a little money spent on a solicitor to look over it for newbies would be money well spent.

Wylie

 

[urban cowboy]

put your claws away Dazz - attacks of this veracity are not helpful or required - a question was asked and i answered it as per the way things occur in general in queensland - dont know about commercial - i don't sell it and as for other states I don't really care at this point...we all appreciate your input and i for one have learnt quite a bit from you - but this little rant of yours is really unnecessary

As soon as I hear the words "basic", "typically we do it this way" and "pre-formatted" and "in general" and especially the words "standard contract"......my "I'm getting royally shafted radar" is on full alert.

then your radar needs tuning - the form is written by the govt. not agents...literally, we just fill in the blanks and do it in front of you...or type them in and present it to you for checking before you sign it. next issue??

Not with me they don't UC. It happens all the time with newbies, and I laugh every time I hear it. The Vendor's paid agent actually wrote the offer to the Vendor. What a cosy little circle indeed. Meanwhile, the nice innocent little other party to the contract sits their quietly while they get rolled.

it was a general response...not really interested in your specifics. and as for getting rolled - over here the buyer signs it before it gets presented so if they dont like something, it can be amended and sorted on the spot.

# 1 tactic people, rip that pen out of the Agents hand and don't let him go anywhere near your offer. Once you've completed it, crossed out any of the standard clauses you don't like, and submitted extra ones that you require....then and only then execute the deal and have it witnessed by someone other than the Vendor's agent.

i have no problem with that, and i am an agent...all this still occurs prior to you as buyer signing and vendor even seeing it.

I'd strongly suggest not even having the Vendor's agent in the same room when you write your offer. The last thing you need is a paid representative of the other party to the Contract P1ssing in your ear as you write it up.

again, unorthodox, but i have no problem with that, as long as the form is filled in properly and witnessed correctly - then sure, no problem - still all occurs prior to vendor seeing it - what is the issue here????

Although, when I come to sell a property, I would very much encourage my paid representative to write an Offer to me.....and importantly whisper encouraging little sounds into the Buyers ears whilst he's writing my Offer to me....wonderful stuff. I'll ask that he doesn't include (or resists enormously) any clauses that I don't want to see in my Offer to myself..

hypocrite!! so you want everything to happen according to your personal little world view all the time, but no one else is allowed the same rights and abilities??? come off the grass Daz

See what I mean, you don't want them "righting" (sic) up your offer.

a typo...so sue me! and as for the comment - what are you saying exactly??? i already said get a solicitor to WRITE clauses, it sounds awful like you agree with me there...good thing i am sitting down.

UC, the agent plays absolutely no part in the legality of the paperwork. The agent does not date it. The Vendors and Purchaser's date their signature and have it witnessed by someone not a party to the Contract. The Agent, as always, has absolutely no legal power in the transaction and plays absolutely no part in the proceedings. Typically, they'd like to think that they do, and they put on a marvellous show for all to see.....but they are not needed and do not partake in any of the contractual proceedings at all.

The seller or the sellers representative (THE AGENT) does date the contract in queensland. I never said we had any legal power...just legal obligations - read queensland law mate...you might learn something new.

I simply love that question.....it is loaded with the implication that the person asking the question is a full bottle on the subject matter and the listener is completely clueless

The way you've written and portrayed it UC.....it makes absolutely no sense whatsoever. I would never do what you prescribe. Anyone who follows that portrayal needs their head read, cos they will have been taken for a huge ride in the negotiation. Great for the Vendor, hopeless for the Buyer.

oh grow up...you yourself just said you want everything stacked in your favour - and now accuse me of stacking things??? it was a general response to a general question - not everything works this way, but generally it does. Buyers can change any conditions they like, they dont have to sign the offer until they are happy with conditions they wish to offer...

you will hear no more from me on this, but if you are going to attack me on responding to a generic question on procedures for QLD residential r/e, get your facts right first or stick to your little commercial world.

Merry Christmas

 

[BenQld]

Just as an update, the Buyers house has gone unconditional, so now provided there are no major problems with that, everything should go smoothly

Ben

 

[WinstonWolfe]

Yeah come on Dazz....you give excellent advice in relation to what you do, and there's a lot of sense in what you said above....but you are being over the top in your attack on UC, who has only ever offered sensible impartial and generous advice on the forum.

Maybe time for a ride on your bike Dazz....take some of that aggro out on the highway, on your Fat Boy.......

Merry Christmas to you and UC....you are both great members.

 

[WinstonWolfe]

Don't sweat it Ben. Chances are the buyer will sell his house as intended, and your parents will settle.

Strike up another one for Miss Probability....

 

[Spectre]

Here I was coming in to turn off the computer.

Ben
Good news

It also might be notable though that I believe in qld there must be a set way contracts are done by the agent and if not then finance and building & pest etc can be 100% approved and appear unconditional but at the same time the purchaser can still terminate the contract as the agent didnt do the documents in the correct order.

UC if you could shed some light
thanks and merry christmas to all.

SS doesnt get any more of my time tonight.

 

[Dazz]

if you are going to attack me on responding to a generic question on procedures for QLD residential r/e, get your facts right first

Having re-read both my post and your highlights, there is no error in fact. I regularly go head to head against teams of solicitors representing the other party of a RE Contract on finer points of Real Estate law. It's what naturally occurs as part of our adversarial legal system.

All types of agent's in comparison, (mortgage / RE / settlement / insurance etc) when discussing RE Contracts, are regularly eaten for breakfast.

Almost always they take it as a personal affront. You get over it eventually.

stick to your little commercial world.

Will do.....and you're right, my RE world is very little indeed.


Apologies for ruffling your plummage.....it won't happen again.

 

[urban cowboy]

It also might be notable though that I believe in qld there must be a set way contracts are done by the agent and if not then finance and building & pest etc can be 100% approved and appear unconditional but at the same time the purchaser can still terminate the contract as the agent didnt do the documents in the correct order.

UC if you could shed some light

you are correct.

for a GENERAL resi contract in queensland you must first present a form 27C - selling agents disclosure statement, form 30c - warning statement, then the proposed contract. there are also cover pages and buyers acknowledgements which get put in there - they are not part of the contract per se, but are there to try and head off some of he problems with proving the order of presentation and signing.

a contract that is not put together in the correct order can be terminated by either party.

a properly filled in and presented contract is usually pretty tight, but again - a solicitor who knows their stuff can work wonders.

where most agents get into trouble is where the buyer is interstate and they fax or email the contract - the documents have to be sent in one order and signed in another. The other problem which i alluded to earlier is in drafting of special conditions. Poorly written conditions can also be cause to kill a contract - hence my statement about always getting a solicitor to write them.

hope this helps,

cheers,
UC

 

[LynnH]

I think that this is about the 4th or 5th time I have read this in various threads. SPAM!!!!!

Cheers
LynnH

 

[Spectre]

Fortunately YMan (i suppose) cleared up his membership status.

 

[Perp]

QLD standard clauses

we know what to put in the "standard" contract and what to make sure is crossed out.

The standard contract works well but if I didn't have a family member who knows these things, I would probably have our solicitor look over the contract.

... adding or crossing out clauses is generally not an issue for us, but I agree that a little money spent on a solicitor to look over it for newbies would be money well spent.

Wylie

Wylie, I presume you're in QLD if you're buying Queenslanders. You may well be aware of this and I'm not in any way attacking you or your comments, but you've reminded me of something that it's pertinent to share at this point.... for you and other QLD purchasers, I hope you're ALWAYS crossing out the ridiculous clause 8.1 (number may have changed since I last looked) of the standard contract... the one where the property is at the buyer's risk from CONTRACT date rather than SETTLEMENT date.

If one doesn't mind having to get insurance on a property that one doesn't yet own, then fine, but I think that this provision is ridiculous. I always change this and make it so that the property remains at the seller's risk until settlement; most sellers will retain their insurance anyway to protect their own position, so don't object to this amendment. (Seek legal advice on proper wording for the amendment.)

I have heard frequently of fellow QLD purchasers not knowing about the ramifications of this "standard" clause and they seem to generally accept this clause but not get insurance. Whilst I've not yet heard of it happening, it's quite possible that the house could burn down the day before settlement and you'd still be forced to settle at full price, and have no means of recovering your losses. Or you may settle, then find that you have a public liability claim some time later relating to somebody falling over on the property during the period between contract and settlement dates. None of it very likely, fortunately, but this is one example of a "standard" clause that could get you royally screwed...

There are also a few to be aware of when selling... but I won't bore you now

 

[wylie]

Hi Tracey. We are in Brisbane and always insure from when we go to contract. I don't have an issue with this at all. In times past, we used to just get a cover note for 30 days but lately, we have had to take out a policy (at least with our preferred insurer) which means we pay one month's insurance while the vendor is also covered (unless they cancel the policy early, silly move, but has happened before).

I think it is money well spent, as houses have been burnt down prior to settlement, and if the vendor is trying to save money by cancelling their insurance before settlement date, I want to know that we are covered.

Our bank will not settle without the insurance anyway, so I just do it.



Wylie

 

[LynnH]

Like Wylie, I don't have a problem with this clause either. I view it as a few dollars spent for peace of mind.

Our Bank also requires that their interest in the property is noted on the certificate of insurance and require a copy of the insurance certificate before settlement.

Cheers
LynnH

 

[s_t]

So you'd be happy to pay the excess (and forefeiting hte remaining time on the insurance) if the building burnt down? If you can't get out of the contract (due to this clause), you'd also have the hassle of rebuilding and waiting while that happened. Would you really want to take possession of a just burnt down house, even if it does have insurance?

 

[wylie]

If a house I was buying burnt down, I would look at the situation at the time. I would either settle, or not, depending on what happened. There are other things that can happen to a house while it is under contract, other than being burnt down, by the way.

In any case, my bank will not settle without their interests being covered (as Lynn also said) so it is not an option. Without insurance cover we don't settle anyway.

I just don't see it as anything to be concerned about.

Wylie

 

[LynnH]

Would you really want to take possession of a just burnt down house, even if it does have insurance?

A similar situation happened just up the road from one of our IPs last year. After QFS condemned the house, the owner simply bulldozed the debris and sold the block of land for a very nice profit - the old Queenslander was in a demolition control zone and could not have been moved, removed, or demolished otherwise - the land without the house was much sought-after!

As Wylie said, it would really depend on the individual circumstances as to what you would choose to do. The Bank would probably want to have its say, too!

Cheers
LynnH

 

[Perp]

I concur with previous posters that it's not a big hassle to get insurance, and yes you do have to have it for settlement. I guess the point that I was trying to highlight was that a lot of buyers seem to be unaware of the requirement to have insurance so many weeks before settlement, and could get badly burnt (excuse the pun) if they don't either a) get insurance as soon as the contract is signed, OR b) waive this clause (as is my preference).

For s_t, few people would be happy with the inconvenience caused by the property burning down on settlement eve, but that's a separate issue. By the time of settlement eve, contracts would generally be unconditional and I'm unsure how you think one could avoid having to settle! Unless you had a clause - not too common, I don't think - along the lines of "subject to the buildings being in a condition satisfactory to the purchaser at time of settlement" or something like that, I think that all "standard" Australian contracts would still require you to settle even if the building did burn down on settlement eve...

Outside QLD, it may be - I'm really not sure - that it would be the responsibility of the sellers to "make good" ie compensate you for the loss, or build a new building, as one might expect, but my point was that in QLD, under the standard contract, not only would you be obliged to settle, but if you had the standard contract and didn't have your own insurance policy (eg you'd asked for insurance cover to start at settlement), you may also have NO ability to recover your losses. ie you could be forced to buy the land for the value of "house plus land" and have no money coming from anybody (insurers, sellers, etc) to rebuild.

All of this highlights that as wylie has said, it's a good idea to get your own insurance as soon as you have a contract, and make sure it covers you for the expenses associated with the downtime while a new building is being built and other incidental losses.

PS LynnH, I once heard somebody say that developers were amongst the worst arsonists around...

 

[LynnH]

PS LynnH, I once heard somebody say that developers were amongst the worst arsonists around...

Tracey, nothing would surprise me .....

Cheers
LynnH