Out of curiosity, how many IPs do you own ?
..and how long have you owned them (if you do)
Losing 10% deposit
- Thread starter Oscar
- Start date
Out of curiosity, how many IPs do you own ?
..and how long have you owned them (if you do)
Tim86, you have got to be kidding me. tell me your looking for a salmon to jump on your line...
what is the point of a contract? It's a legal document man and the basis of doing business and transacting an honorable agreement agreed to by both parties in advance.
I'll let everyone knows what transpires. If I get the 10% and penalty interest about $90,000, I'll pu the house back on the rental market.
3 IP's, 1 PPOR, soon to be 5 IP's. I think it would have to be a couple years since I bought the first one now.
Sometimes things happen that are out of the purchase'rs control. I agree that a contract needs to be honoured and if the purchaser is pulling out due to changing their mind or finding another property elsewhere then they should be forced to settle. But....
Recently a friend of mine sought services of a broker and submitted a loan application with them. Finance was approved and contract went unconditional. Long story short the broker had falsified the figures on the application form and had the loan contracts been signed by the person they would have been committing fraud. They now have to face the prospect of not being able to get finance to settle the property. Rock and a hard place.
Also, what if one of the purchasers pass away during settlement, are diagnosed with a terminal illness? Yes they should have insurances in place but the last thing they would want is the threat of being sued hanging over their head.
If I was selling a property and they couldn't settle due to a death or illness, yes it would be a PITA but I wouldn't force them to settle during such I trying time.
I am business minded but I also have a heart and a big part of my SANF is how other people are affected by my actions because I truly believe what goes around comes around and should I be in a similar position I would hope (not expect) for the same consideration.
Recently a friend of mine sought services of a broker and submitted a loan application with them. Finance was approved and contract went unconditional. Long story short the broker had falsified the figures on the application form and had the loan contracts been signed by the person they would have been committing fraud. They now have to face the prospect of not being able to get finance to settle the property. Rock and a hard place.
Also, what if one of the purchasers pass away during settlement, are diagnosed with a terminal illness? Yes they should have insurances in place but the last thing they would want is the threat of being sued hanging over their head.
If I was selling a property and they couldn't settle due to a death or illness, yes it would be a PITA but I wouldn't force them to settle during such I trying time.
I am business minded but I also have a heart and a big part of my SANF is how other people are affected by my actions because I truly believe what goes around comes around and should I be in a similar position I would hope (not expect) for the same consideration.
Good for you. Take all this person's savings and leave them completely screwed because it benefits you and you have a legal right to do so. Don't even blink while you potentially destroy someone's life.
I love it. A real sense of self centred "it's all about me and my legal rights" mentality with no thought for the impact on others. The world needs more people like that, we don't have enough already.
And of course this is "all about business" and human compassion and emotion should not factor into it. They made a business commitment and they did not fulfil their end of the bargain so they deserve to suffer the consequences.
Strange how you can only reach that conclusion after you remove human compassion and emotion out of the equation first.
Look all that's fine. If that's the sort of person you are then go ahead. You're not the first. But don't try and hide behind excuses for not having compassion here.
You are blatantly deciding to harm someone else for your own benefit when you have the choice not to. Proclaim it loud and proud.
Oh dear......
Whats the point of a contract then Tim?
May as well not have them and go back to the old "trust me" system eh?
Yeah that works.
If everyone did what you would do then property settlements would be a complete shambles with prospective buyers stuffing many a vendor around.
Whats the point of a contract then Tim?
May as well not have them and go back to the old "trust me" system eh?
Yeah that works.
If everyone did what you would do then property settlements would be a complete shambles with prospective buyers stuffing many a vendor around.
Well put The Fence!
The 10% loss of deposits in contracts is not supposed to be a penalty, but an amount just enough to compensate the vendor for their trouble. The vendor may still be required to pay the agent, waste 1 or more months looking for a new buyer, pay advertising costs etc.
The vendor may have also entered into a contract to purchase a replacement property and not being able to settle on their sale could lead to a domino effect...
The 10% loss of deposits in contracts is not supposed to be a penalty, but an amount just enough to compensate the vendor for their trouble. The vendor may still be required to pay the agent, waste 1 or more months looking for a new buyer, pay advertising costs etc.
The vendor may have also entered into a contract to purchase a replacement property and not being able to settle on their sale could lead to a domino effect...
Oh dear......
Whats the point of a contract then Tim?
May as well not have them and go back to the old "trust me" system eh?
Yeah that works.
If everyone did what you would do then property settlements would be a complete shambles with prospective buyers stuffing many a vendor around.
I don't think so. Remember I wouldn't let them off scott free. They would be charged for any loss in the subsequent future sale, they would be liable for the interest, and they would incur a 1% fee. That could still come up to 10%. However it accounts for those situations where a sale falls through, but the person only took up 2 weeks of your time and you got another buyer straight away the next day so you didn't really lose out any more than maybe $1000. Sure take that $1000 and maybe a bit more from the guys $80 000 deposit, but it's not fair to take the full $80 000 off of some poor guy just because finance fell through.
I don't know many people that would just sign random contracts because "Hey if I only waste a couple weeks of their time and they find a new buyer quick it will only cost me $9000 but could potentially cost me $80 000". I think that's still a deterrant for potential buyers considering stuffing vendors around.
And why does it have to be a global judgement? At present it is a situation left to the discretion of the seller regarding what they will do about an individual. Is that individual all of a sudden going to go out and put 10 contracts on 10 houses next weekend because he's been shown mercy with his last contract? I don't think so.
Look the way I'm thinking about this isn't foreign. It's the same way bond works. Bond is paid and given back less any losses to the landlord such as leaving early, or damage to the property, etc... However if you pay $80 000 bond, and you've only done $10 000 worth of damage, what ***** of a landlord would demand the full $80 000!
I think its a case by case scenario at best.
On a slightly different note - how do you propose we prevent people from making serial offers?
You have the right but do you want to enforce it can only be answered by you. If everyone got let off in this situation where would we be? So many sales rely on a chain of settlements to occur. So if one falls over it affects many other people. That said if one party has just been diagnosed with cancer or something like that??? Tough one.
With the bond the deal is the bond provider is meant to pay the vendor no questions asked once the contract has been rescinded or whatever......Hope the broker didn't do the bond application before the finance was formally approved... oh dear could be goodbye.
With the bond the deal is the bond provider is meant to pay the vendor no questions asked once the contract has been rescinded or whatever......Hope the broker didn't do the bond application before the finance was formally approved... oh dear could be goodbye.
I explained that in my previous post. But it was a long post and I was probably waffling so you might have skipped that part.
Exactly right, but I'm not saying everyone should be let off. I'm saying that in this particular situation, where the vendor has potentially very little impact from the sale falling through, I personally would not demand the full amount. In another senario where the vendor gets screwed over for any number of reasons and costs the vendor lots of money, I personally would demand possibly the full amount depending on how much it cost you.
We have done Rent to Own contracts with 4 couple who haven't completed their contract. In each case, their relationship broke down, and they went their separate ways.
They forfeited all their payments. It wasn't anything we did wrong, and we certainly didn't feel guilty by keeping this money.
This is very similar.
We are operating a business, not a charity.
They forfeited all their payments. It wasn't anything we did wrong, and we certainly didn't feel guilty by keeping this money.
This is very similar.
We are operating a business, not a charity.
Even if it was more than the deposit ? Would you fork out more because you thought it only fair?
Or would you want to stick to the contract stated deposit amount?
Tim - sounds like you have a similar value-system to me.
Sure, if needs be, hang on to enough of the money to compensate for the inconvenience, but I doubt the inconvenience would equate to $100k.
I know I would spend the rest of my life feeling anxious and horrible and bad, if if I chose to keep someone's deposit like this. That is probably someone's only supply of money and only chance of ever purchasing a property. A "windfall" would leave a very bitter taste in the mouth in this regard.
As has been said, just because you "can" do something doesn't necessarily mean that you "should".
<< Bracing for the attack - I know not everyone will agree!! >>
Sure, if needs be, hang on to enough of the money to compensate for the inconvenience, but I doubt the inconvenience would equate to $100k.
I know I would spend the rest of my life feeling anxious and horrible and bad, if if I chose to keep someone's deposit like this. That is probably someone's only supply of money and only chance of ever purchasing a property. A "windfall" would leave a very bitter taste in the mouth in this regard.
As has been said, just because you "can" do something doesn't necessarily mean that you "should".
<< Bracing for the attack - I know not everyone will agree!! >>
Tim,
I like the original poster would claim all I am entitled too its a business, simple as that
I do applaud your attitude though.
I personally channel my ethical beliefs through pro bono work and giving back to the community, it helps me really well I'd encourage you to find something similar
I like the original poster would claim all I am entitled too its a business, simple as that
I do applaud your attitude though.
I personally channel my ethical beliefs through pro bono work and giving back to the community, it helps me really well I'd encourage you to find something similar
So it's okay to screw people over with the one hand as long as you are helping people with the other...
I really don't understand why ethics and human decency has no place in business transactions, at least to a certain extent. Yes operate like a business most of the time that's fine, but are you really telling me that because "it's business" there is at no time, under no circumstance, ever a scenario where you would take mercy on someone? Really? Is that who you are?
All I'm saying is that I would make a judgement call in this particular situation, yes you're entitled to be compensated, but this person did not act maliciously, so doesn't deserve to be completely screwed over simply for the OP's gain.
And stop trying to hide behind saying "it's business". That's synonymous with saying "it's about making money" and of course when there is a dollar to be made human decency, ethics, and mercy apparently have no place...no matter the circumstance. In fact it's not even worth considering because it's just "business".
As for the suggestion that I should find a way to give back to the community. As a childrens' crisis counsellor my full time job involves helping the community. I support kids when they are being bullied, when they are being bashed by their parents, when they are being sexually abused, when they are about to kill themselves, when they have mental health issues, when they've been abandoned, etc... In my line of work I see plenty of Australian's getting screwed over every day. And to be honest it really angers me hearing privileged people argue that it's perfectly okay to screw their fellow Australian's over as long as it's done through business transactions.
Ethics: keep your promises, behave honorably
but ignore the promise to compelete the contract of forfeit a specified amount,
spring up all kinds of reasons why its ok for 1 party to break their word
nothing is the poor *whatever*'s fault
Tell your bank you dont want to pay any more, its too hard. they'll just forgive the debt except for 10%
been watching the news travel scandals, the Left-side accuser been caught for the same thing as those right side pollies he accused, but its not the same thing if I do it
one side of this argument presents as the, Labor version of ethics? crap, dumb as a stump
but ignore the promise to compelete the contract of forfeit a specified amount,
spring up all kinds of reasons why its ok for 1 party to break their word
nothing is the poor *whatever*'s fault
Tell your bank you dont want to pay any more, its too hard. they'll just forgive the debt except for 10%
been watching the news travel scandals, the Left-side accuser been caught for the same thing as those right side pollies he accused, but its not the same thing if I do it
one side of this argument presents as the, Labor version of ethics? crap, dumb as a stump
If you want to treat people like a bank does so be it. That's fine, it's your decision. Like I said before, there are plenty of people like that in the world already, you won't be alone.
Also maybe look up the definition of mercy while you're at it.
mercy
1. Compassionate treatment, especially of those under one's power; clemency
This person is under the power of the OP. The OP is choosing to act mercilessly because he can make a lot of money by doing so.
All this discussion boils down to is that there are some commenting that they would show mercy, and there are some commenting saying that they would be merciless.
That is what is going on here pure and simple.
Actually that's not all that's going on here. We are actually also seeing the cognitive dissonance that results when people face the fact that they are acting mercilessly and subsequently try to justify their actions with all sorts of mental gymnastics. "I'm not a merciless person... but it's okay to be merciless in business", "I'm not a merciless person... but it's okay when there is a contract", "I'm not a meciless person... but it's okay to be merciless in business as long as you also contribute to the community", "I'm not a merciless person... but it's okay to be because banks and other business act that way", etc...
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