Would you agree to this?

[ghotib]

Three months ago we agreed to buy a 5-acre block with a house. We are still waiting to exchange contracts. There have been reasons for the delays, but it's likely that one of them is that the vendor is ambivalent about selling.

Yesterday we learnt that the vendor wants to make his sale and his purchase interdependent; i.e. if his purchase doesn't complete he doesn't have to complete the sale (our purchase) and vice versa. We said no. We've subsequently thought that we could have agreed provided the vendor agreed to pay us 10% of our purchase price if he used the clause to pull out, but that seems pretty futile because he probably couldn't pay it anyway.

Just wondering what the worldly wise would do in our shoes. And our hearts; sad to say we've both fallen deeply in love with this property, which is why we've held on for so long. Never fall in love with real estate!!

Ghoti (the unhomed)

 

[tech/a]

You signed a contract and so did he.

Seems he is looking for a way out and his finance may well have fallen through on the other deal.Or any other number of reasons the other vendor may have pulled out---who cares.

DONT give him a way out thats what contracts are all about.
You'll settle he'll live in a shoe box with a wad of $$s.

Apoint a good solicitor---- I mean VERY GOOD.
That should be enough to deter stupidity and keep your hand away from biro's and pieces of paper requiring signature.

Look after YOUR interests and dont be a nice guy!
Nice guys lose.

Ah I see you havent a contract.

Your at his mercy.
Get a contract.
Make it un encumbered he either sells or he doesnt he cant have an each way bet!
Verbal contracts arent worth the paper they are written on!

 

[ghotib]

Thanks Tech. That's what I thought; the interdependency clause struck me as unfair, which is why we said no. Thing is, if it was a deal breaker for him, then would him putting money into it make it fair. We're prepared to pay a 10% deposit which we lose if we pull out. Why shouldn't he do the same thing... if he can raise the cash of course?

We hope it's academic now. Just after I posted the original message we got a call to say that the vendor signed his contract yesterday - without the objectionable clause - and exchange is expected on Monday or Tuesday. I won't really feel easy till settlement, but this is a big step forward.

Ghoti (almost a very small farmer)

 

[Julia]

Goodness, Ghoti, I've been imagining you actually in your new property. Obviously I misunderstood and thought it was very much a done deal.

Do hope it all works out for you. Keep us posted.

 

[sails]

Ghoti, I wish you all the best too.

We had quite a messy and long settlement on our most recent purchase. It might be a state thing in Qld, but we found out that there is very little recourse for the purchaser if the vendor defaults in the standard REIQ contract.

As you pointed out, you could lose your deposit if you default, but there was no penalty in our contract if the vendor defaulted. It is probably something I would want added to the contract if we buy again.

 

[Happy]

Hope it goes well for you!

 

[ghotib]

Thanks again folks. Sails, that's not just a Qld. thing. Same in NSW, and I'm pretty sure the rest of the country as well.

We still haven't exchanged, but I've learnt more about the nitty gritty of the process than I ever wanted to. At the moment we're waiting on the post between our vendor's solicitor and his vendor's solicitor, and I think our solicitor has underestimated the time that will take. Which matters because when we told him we wouldn't agree to the interdependency clause we also said that if we hadn't exchanged by noon on Wednesday the deal was off.

This is beginning to feel like a federal election

 

[noie]

It took me 8 months to buy my House in London.. and right before exchange the seller tried to pull out.

Its been on the market now on and off for 12 months (over 4 years), 2 purchases fell through and I walked away with my interest payments covered for 6 years.

 

[ghotib]

For anyone interested...

We exchanged contracts, without that silly clause, today.

Very, very happy. Also nervous. But mostly very, very happy.

Noie, how did you walk away with your interest payments covered?

Cheers,

Ghoti

 

[noie]

The two times it fell through as per my contracts i held onto their "good faith" payments as they pulled out after the initial exchange.

They were called good faith but in the contract they were basically flee protection.

The first was around 20k the second 28k

not bad money for doing nothing..

back on topic, i am happy you know have your new home, be good to it and may it look after you..

 

[sails]

Good to hear, Ghoti. Trust it all works out well...