I’m hoping for some advice out there from all you seasoned veterans. I put an investment property up for sale 12 weeks ago with an agent. I accepted an offer 7 weeks ago with a deposit of $500 and a deposit bond to make up the 10% it was subject to finance which gave them 2 weeks to get. After the 2 weeks they requested a further week to get finances in order as they were also purchasing a property in QLD. We granted the further week this would have brought them up to 24/11/04 for approval.Today was settlement day and we received a call from our solicitor stating the couple who were buying the house had separatedand the deal was looking very shaky. Our solicitor is going to send them a letter on Monday giving them 2 weeks to come up with the money and also indicating the are being charged interest. I thought to myself thank goodness for the deposit only to be informed by my real estate agent that they had not received the deposit bond from their broker.[angry2][angry2]and now he is refusing to hand it over.The real estate agent encouraged me to to keep the house vacant so as to attract both home buyers and investors. The couple were investors and initially said they would be happy for us to find tenants but when we did they said not to as they would find their own.Thus we have worn the cost of an empty house for over 12 weeks. Any advice on how to proceed would be appreciated and I’m still not happy with our agent who at no stage until today said their was a problem with our deposit.
Martin
I would be going after the real estate agent who did not inform you that the deposit bond was not received. This looks like one hell of a civil dispute and my next call would be to my solicitor.
I would also report the real estate agent to the real estate institute and fair trading.
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter: See – http://www.mortgagepackaging.com.au/index_files/newsletter.htm
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
Brissy 04
did you check your solicitor has or had a pulse?
cheers
brahms
Mortgage Broker
[email protected]Thanks Robert and Brahms,
I have an appointment with a solicitor on Monday, definately not happy with the agent as she should have been chasing the bond hard. Have had some advice. My sales contract with the couple is fairly easy to claim as they will be in breach of their contract. This I can accept as noone can forecast a separation my beef is with the agent who has not insured me for this possibility ie the deposit. Basically they have been holding a $225000 property for 7 weeks now going to stretch out to nine weeks minimum for $500. Do you think I have a civil case against the agent/agency? The problem I have in going after the couple is that already I think there is going to be one hell of a property dispute and no doubt I will be on the bottom of all this. My solicitor had no idea until today of the problem with the deposit as the agent handles the deposit dont they?Martin
martin, i think it is really up to you and your solicitor to look after your interests – i’m afraid this would include your solicitor confirming that the deposit bond was effected and held either by themselves, or the realtor.
if the contract was unconditional on the 24th of last month, why wasn’t the missing bond picked up then by your solicitor.
in my experience and practice, the bond goes to the solicitor not the realtor. for instance i may fax a copy and post original to the purchasers solicitor, who will then advise the vendors solicitor they are holding a fully executed bond – they may fax a copy to them but i don’t know for sure.
as the agent is engaged by the vendor i really don’t know if you will get much out of that angle, other than confirming their incompetance – i’d be seriously questioning what your legal team did to protect your interests for the past 4 weeks.
cheers
brahms
Mortgage Broker
[email protected]I am with brahms regarding the solicitor. They should know if there is a deposit or not as an exchanged contract is done by the real estate agent but confirmed and processed by the solicitors.
I would be interested to see how the agent justifies an exchange without a deposit? The $500 is not what the contracts were exchanged on.
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter: See – http://www.mortgagepackaging.com.au/index_files/newsletter.htm
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
Thanks Brahms,
I just have to clear up one point the person who was handling sale was a property conveyancer. I’ve never dealt with deposit bonds before whenever I have purchased a property I have used cash and given it to the agent. Thanks for your advice. The conveyancer has very close ties to the solicitor(I think the solicitors are the overseerers of this business) I’m seeing on Monday in regards to this matter I hope after reading your comments that they are not out to protect their arses?[blink]Martin
Conveyancer and solicitor have the same responsibility to their client in conveyancing transactions. I would find someone independent.
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter: See – http://www.mortgagepackaging.com.au/index_files/newsletter.htm
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
martin, that was actually the first thing that came to my mind. yes, i’d play my cards very close to my chest on monday, probably nice to take a friend with you – personally i’d take another solicitor.
cheers
brahms
Mortgage Broker
[email protected]Thanks for your help,
I indicated to the conveyancer this am that I would seek legal advice about this matter, I found it a little strange that she organised the appointment for me with their solicitor, Monday 2.00 pm without me asking her to. I thought she was acting in my best interests and she justified it as she could forwrad the file to him directly,now I’m thinking it maybe for different reasons.(Its not paranoia if you know somebody is out to get you)[jerry]Martin
Originally posted by Brisbane 04:
I thought she was acting in my best interests and she justified it as she could forwrad the file to him directly,now I’m thinking it maybe for different reasons. MartinHi Martin
Success as a property investor revolves around building a powerful team of advisors who are +CF savvy.
Since you’re on the verge of seeking advice from an INDEPENDENT solicitor, may I suggest you ‘kill 2 birds with the proverbial 1 stone” and appoint one of the solicitors recommended on this forum or on the other highly regarded IP forum:
For my money, I sought out a “Wrap savvy” local solicitor who a good friend /local wrapper had previously “educated” re wraps. This solicitor is now a very valued member of my team.
Cheers
GregIn my view and the way I look at it:There are two people at error here; your agent who did not collect the bond and your solicitor who did not see that the bond was in place already by the time the contract was executed.
The buyer’s broker may have misled your REA that he had it with him- but that is for yor REA to go after him. there is no direct nexus betwen you and the broker.
If it happened to me I would do as follows:
1/ get an NEW independent solicitor to write to my current solicitor/conveyancer AND RE agent and get a written explanation from each of them
2/ DONT attend the meeting scheduled by the conveyancer to meet her solicitor ( It seems a rather good position to compromise my nterests here)BUT rather get ( 1) done and that way i will ferret out the guilty parties formally and not expose myself at meetings and say silly things which MAY prejudice me in some way or other. Who knows that unless settled fairly, this matter may end up in the Courts. but the less I expose myself( and we tend to do that unwittingly) the better.Better to let the independent NEW solicitor handle it.
Yes it will incur some costs- but they will be incurred anyway, because this is a classic civil case here happenning, as I see it.
For all I know it may only be few hundred dollars but they will be worth spending than compromising my interests later on.I would ALSO CONCENTRATE on the remedies to pursue for damages claim.
Good Luck/piperIt has nothing to do with the buyer’s broker either. They send an unsigned bond to their client. The client signs it and hands it to the real estate agent or sends it to the vendors solicitor or even gives it to the vendor.
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter: See – http://www.mortgagepackaging.com.au/index_files/newsletter.htm
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
[shades2]As you can tell I’m new and confused. I don’t understand why there is a 10% deposit. I did not realise you had to give so much. Is this how much you have to give down south?
Inez[dizzy]10% deposit is not a hard and fast rule. It is just a standard unless you ask for a different amount. Deposit BONDS tend to be written for 10% of the purchase price for simplicity in most cases.
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter: See – http://www.mortgagepackaging.com.au/index_files/newsletter.htm
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
Hi all,
10% deposit was what was offered by the purchaser and what was agreed to by us. There is no hard fast rule what deposit you leave it merely has to be agreed to by the seller.Martin
We seem to be distracted from the issue- of negligence here. What is the course to take should be the proper focus.
I would quickly ascertain formally if the buyers are going ahead with the contract otherwise prepare to put it back on the market to minimise my damages- of course with my independent new solicitor’s advice..Just my 5 cents worth
PiperI’d be extremely unhappy with my solicitor
So what happened next? Let’s have an update please.
Hi All,
Had solicitors appointment yesterday, the solicitor has drafted a letter I think it is a recession notice that gives the purhasers 2 weeks to settle the property of course as each day passes the are being fined due to late settlement. Once the 2 weeks is up my wife and I have to decide whether we will keep the property or sell it again.If we decide to keep it we have to get an independant valuation on the property and depending on what the valuation is the former purchases are liable for any costs associated in bringing the deal up to $225000 ie If valuation comes in at $219000 they will be up for $6000 plus my legal costs plus lost rent plus the fines imposed and any other justifiable out of pocket expenses. If we decide to sell we have been advised to do it by auction as this shows proper market value ie all hell could break loose if there is seen to be any hanky panky ie selling to a friend for far less than it is worth.In any case the purchaser is liable to ensure that I achieve a price of $225000 plus any costs that are incurred by me by the breaching of the contract by them. This is where the deposit comes in and would cover these costs but since that is not there I have to chase them for the money. At present there is no indication that they will settle the property. As for the real estate agent. My solicitor obtained a detaliled summary as to the lengths they went to to secure the bond. The agent appears to be good friends with the broker and although they had regular contact between each other he did not secure the bond. The broker discovered 2 days before settlement that the deal wasnt going ahead and had no intention of releasing the bond due to same. At no time during the chase for the bond did the agent contact me to inform me of the problem. The solicitor informed me that they have indeed not handled the situation very well and I may have a case for negligence but as any one knows negligence can be hard to prove as I have to show that there actions caused me damages ie they will argue that they did indeed try to get the bond and and no matter of badgering were going to get them to release the bond. My wife and I have decided to first chase the purchasers for monies owed and then decide to chase the real estate agentafter this. It has been a learning process.[biggrin]Martin
You must be logged in to reply to this topic. If you don't have an account, you can register here.
