I am set to close on a short sale property in Orange County, CA next Monday. I signed the loan documents Wesnesday and paid my closing costs. I got a call from Escrow officer stating that Seller is not ready to move out and needs 30 days to find a place. My agent said that he is required to move per Short Sale agreement and he is getting relocation money from the bank. Escrow officer is basically pleading us to give him 30 days and that they would PAY rent equal to Mortgage for November. A few things that trouble me is, isnt this against the law for him to collect relocation money but still occupy the condo? Secondly, why did Escrow officer wait till last minute to tell me Seller is not ready. We have been in escrow for 4 months!! Thirdly, Escrow officer told Seller to pay rent equal to Mortgage amount without consulting with me or my agent! I am starting to think Escrow is friends with Seller ? I dont know what to do! I want to be nice but I am scared. I am a First time buyer.
After a heated exchange between my agent and Escrow officer where they threatened to cancel escrow, I just received a Purchase agreement Addendum stating that Seller will remain in possession after close of escrow for 30 days. The Addendum is signed by Escrow officer on behalf of the Seller !! Does this document hold ground should Seller fail to perform?
My agent said not to sign or respond and proceed with closing....Escrow only sent it to me and not my agent where she usually copies my agent on all correspondences. My Agent is not experienced with short sales gone bad. Listing agent and Escrow officer works for same company so reaching out to Listing agent/broker is out of the question. I am not sure if that is a conflict of interest but I dont know the law.
I honestly want this ordeal over with minimal damage to my property. My loan is set to fund on Monday!
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Funny thing is I just had a deal where we are had everyone except the Buyer sign, we were set to close on Monday and Sale Date was Friday (Ocwen). Buyer did final walkthrough on Monday morning (drove 2.5 hours over to sign docs) to find out the Seller didn't even started nor were they seem motivated to move at all. Buyer didn't sign, Seller got foreclosed on later in the week. Not just that, they also lost $2,000 relocation offer from Buyer, along with a $1,800 credit card judgement the short sale lender would've paid for them through closing the SS. One baby step away and the deal went down the drain because the Seller thinks he can play us for a fool and stick it out as long as possible without having to move.
As for your situation, and if I was in your situation, I would keep all correspondence on black and white, and tell the escrow officer that I WILL go to ALL of their overseeing authorities if the Seller didn't vacant within 3 days after closing. Let's see if they'll try something else. If so happens I have to agree on more than 3 days down the road, like Bryant mentioned, I would use a lease agreement and collect deposits + the rent just in case they damage the property when they moved out.
The way I see it, some Sellers are emotionally attached and is very difficult for them to move, which is totally understandable, but they'll move. But there are some out there who will only think about themselves and try to stay as long as possible thinking there is nothing others can do about it. You might be facing with one of those Seller in your situation. Keep record of everything that you and they're doing and hope she'll move out per agreement. Best of luck.
We met with the Escrow office today. We showed her all the email communications we had between Listing agents and Escrow officer upto time of closing and not a single document stated that Seller will stay in possession past COE. We told the Escrow officer that we will consult with a Real Estate Attorney if necessary if we dont come to an agreement.
Escrow officer ( who now claims to be a family friend of seller) immediately changed her tone and started talking about Seller's health condition and that 3 days is not enough. My agent and I agreed to offer assistance to pay for a moving company! Escrow officer agreed. We sent her an Addendum stating Seller will be out in 3 days post closing! My loan is funding Monday and recording Tuesday. We will do a Final inspection on Friday before I pick up the keys!
I suggest you seek legal advice asap. You at least need to get an opi9nion form someone who is not getting paid on this transaction.
The purchase contract dictates when the seller needs to move. Any changes to this would need to be in writing and agreed by all parties in writing. Unless the escrow officer has power of attorney for the seller then they have zero authority to sign and their behalf.
Now having said that it may make sense to give the seller the time they need. Just be sure that any post occupancy period terms and conditions are put in writing. Including who is responsible for maintenance and repairs during this period. Use a lease agreement.
Please seek legal advice. /this response is just my opinio9n based on my experiences and in no way should be construed as legal advice.
I hope this helps.