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I am sorry to learn about this issue. Unfortunately there are only very few real estate transactions in which the buyer is entitled to a recision period. (Your transaction may qualify, but this is very fact specific). Here is an article that explains in a reasonable amount of detail the situations in which the 3 day right of recision would apply (purchases from developers or in situations where the contract itself allows for 3 days of review); or in cases where there is fraud (did the seller misrepresent any material aspect of the home or purchase to you).
Sounds like the recission law holds for a mortgage company selling a condominium
I was not told the escrow amount beforehand which is over $2500 and must be wired from a bank. The contract has also not been signed by the seller yet
Was the mortgage company the developer? (Or in direct privity with the developer? - meaning that they received the property directly from the developer).
So you have not agreed to the entire contract?
Price is considered a "material" term to the contract.
I don't think the mortgage company was the developer. The property is from the 1980's and was a forclosure
If the developer has not yet signed the contract, your "offer" to purchase has not yet been "accepted" therefore you can still "withdraw" your offer (quotes are to refer terms for legal significance)
What does agreed to the entire contract mean in this case? I am a first time homebuyer and the auction process was time pressured such that there wasn't time to study or get legal counsel about the contract. I won't bid in an auction for property again.
It was docusigned, but not hand-signed
If you do draft your letter (and send it electronically, by fax, by mail, or combination thereof to ensure it is received as quickly as possible) to withdraw your offer to purchase that will withdraw your offer to buy and the seller will be unable to accept. The problem is that I understood this to be through auction, in which case you usually agree to "buy" upon successful bid, in that case you will need to check your contract with the auction company to see what it says regarding final bids and purchases.
I think it can be rescinded, right?
I think it says I will lose $2500 hold put on my credit card, but there is now no such hold
so the problem is with the auction.com site then
I will write the letter now and send it so that the seller is aware. I am not sure I can obtain financing at this time or can meet the deadline for the large earnest money deposit
It is better to be upfront right away, I assume
I don't want to default, but the contract is terrible and the mortgage company is in bad repute on BBB
I didn't know who the seller was
Remember - I cannot see your documents, and this entire deal will be based on what exactly is stated in your contracts. So, with that in mind, if your contract with the auction site says that your failure to complete a purchase results in a 2500 penalty, that would be the penalty (they will probably get it one way or the other - but if not you can count yourself lucky). If the contract for purchase was not signed, you can probably withdraw from it. If it was signed (even "docu signed") you may be obligated under the contract. The good news is that your damages will be limited to the actual expenses they incur by not being able to sell the house immediately (loss profit), and they would have to actually pursue these. You can probably still find a basis to withdraw from the sale, particularly under a "fraud in the inducement" basis if they did not disclose the full terms of the sale to you (material terms, meaning the money aspect).
I realize I was stupid and will never do this again. Just frustrated after being beaten out by investors for 4 straight years of homebuying attempts
so I should write a letter and send it right away or try to scrape together the financing and deal with the sale?
This might be something you will actually want an attorney to take a quick look at for you (it shouldn't take an experienced real estate attorney more than an hour to look at two contracts and give you a "quick opinion" regarding your situation). It is probably worth the money to know exactly where you stand following the above "general" analysis, as I have stated, this is entirely contingent on the 2 contracts and while I am not permitted to interpret any contracts through this site, trying to assist you with two complex ones at the same time is probably going to be counter productive. Given the fact you are in a time crunch, it may be worth a small investment in legal counsel for an hour on Monday.
I'll try to fit that in between work.
It seems I may be able to quit the contract, but not the auction.com terms then
Should the escrow amount have been disclosed prior to bidding on the property?
it says that purchase documentation cannot be submitted to the seller without the earnest money deposit
That would not be a bad scenario given the long term obligations caused by a home purchase. However, I would want to go through both contracts carefully (and if no deposit was authorized on your card to date, you may be able to get around that one too, but I don't know if that is sufficient or not).
Escrow can be considered a material term in a sales contract (meaning that if it is not fully disclosed and discussed, there is no contract). However, when property is purchased at auction, these rules sort of "go out the window" and the highest buyer receives the property in exchange for the full sales price - unless some other special arrangements are made. Purchases of real property through the internet have created some difficult scenarios for many buyers (and sellers).
You can find attorneys on your State Bar Association’s website: (http://www.floridabar.org/tfb/TFBConsum.nsf/840090c16eedaf0085256b61000928dc/ec2322e512b83d1e85256b2f006cc812?OpenDocument); Martindale Hubble: (http://www.martindale.com/); or, on AVVO: (http://www.avvo.com/find-a-lawyer).
To keep costs down, I recommend finding an attorney that is working in a small firm or as a solo practitioner. A newer attorney usually charges slightly less than a more experienced attorney, while the more experienced attorneys are usually a little more efficient. In the end, you need to find an attorney that you feel comfortable with, and it is okay to speak with more than one before retaining one.
so the seller doesn't have the document and my dealings are with the auction company
From what you describe - you may only have a contract with the auction company, and not yet with the seller. That would be good.
That is true
I do not have a contract with the seller yet
The auction.com site says I might be liable for liquidation damages if i default
in addition to the $2500
I guess I need an attorney
Liquidated damages are a specific dollar amount agreed upon by the parties for damages in the event one party breaks the contract. In this case, it sounds like they have bargained with you for $2,500.00 in liquidated damages.
Is it best to inform the auction site now or not to give them notice until after I hire an attorney
just a minute, if you can spare the time
You should be able to find an attorney to take a look at this for you tomorrow some time. (Like I said it will just take a few minutes for an experienced attorney to review this - you can email it to them, you don't even have to be in their office while they look through it).
guess my job is to find one then
Try www.AVVO.com (it probably has the easiest to use system of the 3 for finding an attorney quickly), after that use the FL Bar site, and finally Martindale.
thanks for the info
I think you are right about the 2500 being the liquidation damage money
so I would lose that if I default.
Defaulting is easy
2 hours to sign the contract after emailed, when you might be otherwise occupied doing something vital at work
not enough time to review with an attorney or even to read it, if you get to the email late
I was told the email would arrive 20 minutes after I made the necessary phone call, but it didn't
I did not have 2 hours to docusign and send. I had 15 minutes or default
Is it a violation on their part to tell me the email would arrive in 20 minutes on a recorded call and then it arrives an hour and a half later?
It is possible that by the delays in their service it can be deemed a material breach in their duties under the contract. (Yes).
the documents to sign arrived on a Saturday. What attorney works on Saturday?
I certainly hope so
I do believe there needs to be time to at least read a contract
and if not signed and sent in on time, default?
seems like a problem to me
I think the 20 minutes on a recorded call should be binding seeing as I only had 2 hours to sign on a Saturday
or default and lose $2500
well, I appreciate your time and input
You are welcome, I do wish you the best of luck in this matter. Hopefully you are able to achieve a quick resolution with these entities.
I certainly hope so. That's the last auction for me.
I don't blame you, if you have any further questions please do not hesitate to let me know and I will follow up quickly.
Thank you for using our service, please do not forget to rate my answer when you are satisfied.
I'm dealing with just the auction company. That's a relief
$2500 is much less than the cost of the condo
That is true. I was worried you were tied into a purchase agreement.
Have a great evening.
Your answer was great!
I submitted your excellent rating.
I was worried, too. Now I'm not.
Thanks, XXXXX XXXXX the same.