Profile picture for user2497342

A House we love is under due diligence and the sellers haven't heard anything from the buyers. Is th

Ok so my wife and I found a great house that we fell in love with, but we find out the seller signed with someone else the morning we saw the house. So we put a back up offer and came into an agreement. Saturday is the last day of due diligence for the first buyer, and the sellers haven't heard anything from them so far even though the buyer already sent someone to inspect the house.. the sellers really want to go with us because of our offer, but have no choice due to the binding agreement they have with the first buyer. Is there anything we can do in order to buy this house?

The our agent says there's nothing we can do if the seller is in an agreement under due diligence. The seller agent haven't told the buyers that there's a 2nd offer in. Our agent says there may be 2 situations. 1) Buyer's agent hasn't finished with the post inspection form/offer. 2) Buyers are looking at other houses.

Any advice or help would be appreciated.

  • March 20 2014 - Suwanee
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Answers (12)

Profile picture for wetdawgs
I'm sorry it didn't work out.  The sellers and buyers always have the option to continue to negotiate deadlines, so it can be frustrating being on the outside hoping for good news or even any news.    May you be first in line for the next one. 
  • March 27 2014
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As difficult as it may be, it is always best to try to remove your emotions from the equation (regarding the home) when buying a home. Another words, don't fall in love with any property until you know it can be yours. Gwinnett County has lots of beautiful homes... let me know if you need help finding one!
 
  • March 27 2014
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Profile picture for sunnyview
"We wasted about 3+ days waiting for the agent's response even after the date passed."

Thanks for the update and sorry that it didn't go through. I understand your frustration, but you have to understand the seller agent duties to their seller too. The seller's agent has to do what their client asks so if the seller wants to wait on a particular set of buyers their agent has to wait. That also means that they may not be able to communicate freely with you. 

This house didn't work out, but hopefully there is a better one out there so keep looking and I wish you good luck.
  • March 27 2014
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Profile picture for user2497342
Just an UPDATE:

The date has passed, and we couldn't buy the house. The seller's agent (who very well kept contact with us to the very last day) stopped responding to our calls, texts, and emails on the last day. Our agent event went to the house, but no luck. They are completely "off the grid" with us. I guess the buyer decided to go ahead and continue with the house.

I don't mind someone else buying that house, it's the agent that really makes me angry. We wasted about 3+ days waiting for the agent's response even after the date passed. No phone calls, texts, or even an email telling us what happened...
  • March 27 2014
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This sounds like a great opportunity to keep looking.  Based on the information you provided, the sellers are in a legally binding contract with other buyers before you entered the transaction.  At this point, you wait patiently to see what the other buyers do, or you continue searching for another house.  Good luck!
  • March 27 2014
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Profile picture for Sally English
On the Georgia GAR contracts, the due diligence period allows a buyer to inspect the home and make decisions about whether they wish to ask the seller for repairs etc.  It is my understanding that unless a buyer submits a counter-offer requesting repairs etc, OR submits a Termination and Release THEN the contract continues as written and the buyer loses the due diligence contingency.

You, the seller and the other buyers would need to consult a real estate attorney who specializes in real estate to determine the status of the first buyers contract.  This would be beyond the scope to the agents or Brokers involved in the transaction.
Sally
  • March 27 2014
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Profile picture for wetdawgs
So, what happened?
  • March 26 2014
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Buyers pretty much control things during due diligence - it's pretty much an option contract. Sellers can influence things if/when they come back with repair requests from the inspection or on any other due diligence items. They can refuse to do any repairs or make any concessions, then it's up to the buyers to decide what to do. At that point they would either terminate or accept the seller's not doing anything.

The other contingency is the financing one and the appraisal is part of that. If it appraises below contract, the sellers will almost certainly be asked to reduce price - they can refuse to negotiate there as well and toss it back to the buyer. At that point the buyer can cover the difference or terminate with a loan declinaton letter.

It's not uncommon to bind a home and keep looking - not really good for sellers as it ties up a home but we see buyers do just that.
  • March 26 2014
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Even though the buyers' due diligence period has expired and they've said nothing to the sellers, they are still in a legally binding contract to purchase the home.  The expiration of the due diligence simply mean that they are no longer able to cancel the contract with no penalties based on the condition of the property.
  • March 24 2014
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The Due Diligence period is for the purpose of making sure that the home is to the Buyer's liking and approval and that the Buyer wants to continue with the purchase of the home. In Georgia, the Buyer can request to terminate their purchase offer anytime during the Due Diligence period, for any reason, and have the right to the return of their earnest money deposit. If the Buyer defaults after the Due Diligence period, the Seller is typically entitled to capturing the earnest money deposit as compensation for taking their home out of the available market. Of course, there can be special stipulations written into the Purchase Offer that will give the Buyer additional ways to regain their earnest money deposit after the Due Diligence period. e.g. Loan Contingency.

Once there is a binding Agreement, even if the Buyer disappears afterwards and the Due Diligence period expires, there is nothing that the Seller or other potential Buyers can do until after the contracted date of closing. Once the Buyer shows that they have no intention of purchasing the property (by not showing up for the scheduled closing or by prior written statement), then the property can be marketed for sale as "available" and sold to another Buyer. Up until the day of closing, the contracted Buyer can claim their right to purchase the home, regardless of the fact that they were a no-show during the days leading up to the closing. 

Unfortunately, you and the Seller just need to wait and see what the original Buyer ends up doing before the Seller can legally make the home available to you.

 
  • March 20 2014
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Profile picture for wetdawgs
It sounds like the buyers are doing the right things. You describe that they've sent out an inspector.   Once an inspector comes out s/he writes up a report in a day or two then the buyers consider their options.     My calendar suggests that it is two days until Saturday.    Sit back and relax for a few days and then Sunday or Monday you'll know if you have a chance.  



  • March 20 2014
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Profile picture for Andy Wu
If the Binder (Offer Sheet) is signed by both the Seller and Buyer that means the contract is fully Executed. However, if the Buyer did not Sign the Binder and the deadline for Inspection of the House is this weekend the Seller can offer the place to you.

Most likely the Buyer is waiting for the Inspection report to come back to make sure there are No defects with the house and if there are defects usually the Buyer will request a Credit for the house, have the Seller Fix the House before Closing or even back out in worst case.

If they don't do anything by Saturday or sign the Contract , The seller most likely will Offer the house to you.

 I doubt they are looking for another place because they have paid the Inspection Report and Attorney Fees.
 
  • March 20 2014
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