What is Allotted can’t be Blotted

It was a turmoil that required a timely solution, the situation was getting trickier than it looked at the face of it. By then I didn’t inform the listing agent that I had already investigated and found that he himself is the father of the owner, who had passed away 3 years back and at present, there is no legal owner of the property for which we have got into a contract. By then me & my clients were in dire straits, there were multiple problems, starting with the listing agent not coming up with the truth and so getting him to sign the cancellation papers looked grim, then the escrow office not supporting us enough to let the offer be canceled as invalid, over that my client’s money is stuck and they can’t offer to another property until this money is released and to top it all they will have to leave the rented accommodation in another 30 days and I being their agent had to resolve this entire thing and get them a house in a maximum of 30 days span. I can’t let my client who is 7 months pregnant go through this uncertainty and anxiety.

How could I bring my clients out of this crisis situation?

Introduction

It was Monday morning and one of my old clients, John, called me to happily refer me to one of his friends from his neighborhood named Eric and Suzy to aid them in their selling and buying of property.

With a proposal for becoming their agent, the same day I called Eric and fixed up a meeting with them, little did I know that I was getting into a plethora of experiences. As planned, I visited the couple at their house and it was a pleasurable experience to meet such a wonderful and warm-hearted family. 

After an initial discussion, we agreed to go ahead with the proposal. During the course of our discussion, I got introduced to the family of four and they were preparing to welcome the fifth one – their third child. The house they were living in had two bedrooms and while they were on their way to family extension, they wanted to move into a bigger house with at least 3 bedrooms for a comfortable living and also wished to have a backyard since they loved gardening. 

The Sale

After a lot of brainstorming, my suggestion was accepted by the couple and they agreed to put the property up for sale immediately since the market was really hot in terms of selling homes. As explained to them that to get the highest price, a vacant home works best, as then it becomes easy for getting the property ready for the market and also gives access to Realtors to show the property anytime.  They immediately acted upon it and moved into a rented apartment. Eventually, post research, considering the relevant metrics we decided on the price for the property. As already told, they, being extremely cooperative people, rented an apartment for six months to move in.

Immediately the property was prepared to face customers and parallelly, the staging consultation was done with the staging company. After completion of the inspection, the reports were ready and the property was all set to greet new prospective buyers. Since the family had already vacated the premises, the property was put up for sale in the market, at a competitive price. After a week of open house, offers were received by next week. We had in total six offers and one of them had outbid everybody. The property at Stayner Road fetched a price of $910,000, a price surely beyond their expectations & the deal was closed just within 21 days. Eric & Suzy became happy sellers, the smoothness & the effectiveness of the process were a matter of delight for them.

The Search Began

Now the family was all set to look out for their bigger and better home and preparations were started accordingly. The first house we went to, was in a complete mess and would have involved huge costs toward repairing work. Then we checked another house and they got interested. They liked the neighborhood quite much with the home being 1300 Sq.Ft with 3 bedrooms & 2 bathrooms. The market was so upscale that another buyer offered a considerably high price and our offer was not accepted. Similarly, two other offers didn’t go through.

Buying a property is always an emotional journey many clients go through because you might like a property that doesn’t fit in your budget and have to let go of something which got close to your heart or you may end up stretching your budget too hard to make a hole in your pocket to get something you really like.

The Contract

In that area, there was one house that had been listed for a long time, which caught our attention. This property was located in South San Jose. To pursue my client’s choice, I contacted the agent who wasn’t well responsive initially however, after a while I could make all arrangements for my clients to have a look at the property. At first sight, they just loved the property. It had all the things so precise to their requirement. It was a beautiful property, updated, upgraded, had a beautiful backyard which made them excited since they loved gardening. Eric expressed his doubt regarding the property not being sold yet in spite of being so beautiful & listed for so long.

The doubt crossed my mind too but I didn’t get any concrete answer from the listing agent. So, we concluded that the high price of the property might have been the reason for not getting a suitable buyer. It was priced at $100,000 over market value. We decided and made an offer lower than the listed price and the agent countered back. The asked price was still in the price range of my client and we reconsidered and resubmitted our offer. This time the offer was accepted and we got into a contract. It’s time to relax now. They have finalized their property. This house would be their dream home and they loved the neighborhood, the home, the backyard, the amenities. They just loved the property and were over-excited with their offer acceptance and the contract was signed.

The next moment Eric was on top of everything without even reminders. He gave the deposit money immediately and also gave notice of 35 days to the rented apartment they were living in currently. We didn’t have an inkling about what is waiting for us behind this moment of happiness.

The Unprecedented Twist

Now, post the contract we moved to the Loan agent for the processing of the loan papers. As registered in the Preliminary Title Report (everything about the property which is registered is provided and usually the name of the owner is mentioned there), I had mentioned the name of the owner as Seller in the offer. When we sent this offer to the listing agent, he responded that this property is under an LLC name and so it would be great if we can mention the same in the papers. Knowing this, I responded that the Preliminary Title Report mentioned the Owner name without LLC. To that, the agent replied that the change is in process and all documents have been submitted to the ESCROW company. I believed the Listing Agent that it was a family-owned property and since each wanted portions of the sale proceeds so was the decision to get into an LLC and the offer was written on the aforesaid understanding.

However, the loan agent, on receipt of the purchase contract, asked me for an updated preliminary title report. She apprised that our contract mentions the name of the owner with LLC though the preliminary title report doesn’t mention the owner’s name as LLC, which must mention it and so is the requirement for an updated one. On enquiring with the listing agent, he was apprised that the owner reasoned some pending paperwork and the property will become an LLC soon. In the same conversation, he too hinted that the contract would need 45 days to close instead of 30 days. This triggered a doubt in me and prompted me to investigate. On further enquiry we were made to understand that the listing agent is also the owner of the property. In the meantime, on enquiring with the escrow company, they confirmed that the property would soon become LLC, paperwork is under process. Digging deeper it revealed that the owner of this property is the listing agent’s son who had passed away in 2018. 

The Ordeal

Here the listing agent, who also happens to be the father of the deceased owner should have revealed to us the truth about the owner, instead, he had surreptitious plans to move to court seeking the ownership of the property, while he had been earning rentals by renting out the property of his deceased son all this while. The decision about ownership from the court was yet to be pronounced and that caused a lot of anxiety to my clients. This entire development made us worried for the reason that 3% of the earnest money, the initial deposit was wired to escrow and this was a non-contingent offer, which meant if we fail to perform or we do not close this deal my client stands to lose his hard-earned 3% deposit money.

After a lot of head-scratching exercises, I went ahead and spoke to the escrow officer to know the reality behind this submission of docs regarding LLC. I spoke to the manager and came to know that they do not possess any documents regarding LLC and the property still remained in the name of his son. I proposed to the manager that because the entire offer is written in the name of the wrong owner, in this case LLC, makes the whole offer null and void. So I requested them to cancel the order on the basis of nullity of the offer and pay back my client’s money, unfortunately, the escrow company refused to do so stating their requirement of the cancellation papers and the confirmation from the Seller. I reminded the escrow officer that She is creating difficulty when the offer itself is null and void from legal parlance. The escrow officer didn’t move from her stance and informed she can’t go ahead without the Cancellation papers from the seller.

Amidst all these, my Clients were losing time since they were exhausting their numbered days in the rented accommodation as the Manager of the rented property had refused to extend their tenure. In spite of such an uncertain situation, I was determined to bring them out of this chaos. It was a turmoil that required a timely solution, the situation was getting trickier than it looked at the face of it. By then I didn’t inform the listing agent that I had already investigated and found that he himself is the father of the owner, who had passed away 3 years back and at present, there is no legal owner of the property for which we have got into a contract. By then me & my clients were in dire straits, there were multiple problems, starting with the listing agent not coming up with the truth and so getting him to sign the cancellation papers looked grim, then the escrow office not supporting us enough to let the offer be canceled as invalid, over that my client’s money is stuck and they can’t offer to another property until this money is released and to top it all they will have to leave the rented accommodation in another 30 days and I being their agent had to resolve this entire thing and get them a house in a maximum of 30 days span. I can’t let my client who is 7 months pregnant go through this uncertainty and anxiety.

How could I bring my clients out of this crisis situation?

The Retrieval

First, I picked up the phone and convinced the listing agent that this escrow office is not updating the Preliminary Title Report in LLC name and my client would make another offer in the name of the existing owner if he agrees.  We can make a new contract and approach another escrow company, however, to write another contract and change the escrow company we have to cancel the initial contract we have in hand. Asked for his agreement to cancel the existing contract and release my client’s money in that case. The listing agent immediately agreed to our offer and I got Eric to instantly send the cancellation papers. So, the first step got managed. We had the cancellation papers in hand for the offer which was made and now I could see some light.

With the cancellation papers in hand, the escrow officer told me that it will take another 10 days since they need to send an email to the Owner and wait for his confirmation. I was shocked, they will wait for the dead man to reply to their email!!! I tried to make them understand the gravity of the entire situation. I showed them the death certificate of the owner, which I managed to get from the county, and asked if they are even listening to what they were saying? How does a dead person give consent?

I wanted to coordinate with the Corporate. The title officer connected me to the corporate and he informed me that even after understanding the entire situation they will not be able to deviate from their protocol, which needed her to wait for the seller’s confirmation and they really didn’t know how to resolve this issue.

I was losing my nerves by then and suddenly by God’s grace, an idea struck and I proposed to the corporate, as an escrow company you can reject this escrow. Following the rejection of the escrow, the money which was wired to the escrow account you are rejecting has to be released and that money comes back to the client since you already have a cancellation. The corporate agreed to this and my Client, at last, got the earnest money of 3% back. What a relief!!! At last, the money is at least retrieved and not lost.

Yet Another Upsetting Snag

We got back to our search for a suitable house. The process was getting strenuous by now, looking at the properties, coordinating entire inspection reports, deciding on the price, running comparable, and in this whole affair, they went ahead and made two offers which were not accepted. Then there was a third house they really liked and over that, they had so little time in their hand as they had to leave the rented apartment since the manager refused to extend their rent.

They zeroed on one property though it needed a lot of repairing work, still, they agreed since they will at least have a shelter, which now worried them the most. They were desperate to finalize on a property. If the deal doesn’t happen within time they have to move in a hotel and move everything in a storage and this will eventually add up more & avoidable movements. With her pregnancy, Suzy didn’t want to get into all this mess. However, on their insistence, I went to the listing agent of the current property they liked and shared the information with the clients that the offer can get accepted at $1,200,000. I also apprised the couple about the huge repairing work, which will incur huge cost but still they insisted and we made an offer. By that evening the agent called and informed us that they have an offer at $1,220,000 and we must overbid. My clients agreed to put all their money which was $1,250,00 and so we reupdated our offer. 

For the first time in my career, I wasn’t happy writing the offer since I failed to convince them that this isn’t a right deal and they are putting in their money in a non-deserving property. However, God works his way and the listing agent informed that someone outbid this offer too and took the property away at $1.3 million.

Though the agent in me was kind of fine with the cancellation, the human in me was extremely upset with the state this family was in. When the news broke to them, Suzy broke in tears and that made me feel terrible. I had by then prepared to bear their hotel cost if at all needed.

The Silver Lining

Then suddenly we came across a beautiful property in the same neighborhood with the same kind of layout of the property we just lost. This was listed at $1.2 million. I informed my clients about this property. They were skeptical after all these fiasco and emotional stress they had been going through and were not convinced because we couldn’t manage to get the last property in spite of being in such a poor condition and this current property is so much bigger & updated.

Nevertheless, I could convince them to give it their best try and go ahead and needless to mention here this was the best property till date whichever we have seen. After the visit, they fell in love with this property.

Hence, I spoke to the realtor and offered the listed price. Though the realtor assured us of acceptance of the offer if made within 8 hrs, however, the seller would not let go at that price and looked for a higher price. After discussion with the clients, we made an offer at $1.26 million, which was the maximum they could stretch and fortunately the offer got accepted and the deal was closed within 15 – 20 days and the appraisal of the property came at $1.280 million, so the clients already had $20k equity on it.

The Happy Ending

The clients were happy and we finally closed the property at Henderson Drive. Now they own a home, a beautiful home in a great neighborhood, a huge backyard, 4 bedrooms, 2.5 bathrooms, fully renovated and updated. 

It was a rough journey indeed but all’s Well that ends Well, At the end the client had their dream home within the scheduled timeline and it was gratifying for me to fulfill my commitment as an agent in spite of unexpected hurdles.

Home Happy Home

Review by my aforesaid clients:

"My husband and I decided to sell our home with the plan to upgrade since our family is growing. Madhu was recommended by a friend of ours and we are so glad to have her working alongside us - this was our first time to sell and she guided us in every step. Based on our experience with Madhu, here are the reasons why we highly recommend her:

- From the first meeting we already liked her, explaining to us what we need to know. We appreciate her honesty from the start so that we are well-informed and we are prepared for what to expect.

- Madhu is so friendly and so easy to talk to. We are able to ask questions comfortably and she would always respond promptly. It was indeed a pleasure working with her!

- She has great insights on the market - when to list, do open house and collect offers.

- She knows the right vendors to work with especially for the staging of the house.

- She presented to us what will command the highest price (vacate the house) but did not pressure us but worked with us to meet our house prep timeline.

- Has great suggestions on whether to embark on an improvement, repairs, buy warranty or keep status quo hence helping seller to save on costs.

- When our house was listed she was on top of it, keeping us updated and we are so glad how smoothly it went. To make it short, she made it possible to meet our desired goal including Escrow close timeline.

If you are looking for an agent, just contact Madhu. She is reliable, diligent, honest and we love also how friendly she is but still very professional. She makes sure that she represents her client. Now we are looking forward to working with her again as we look for our next home."

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" Thanks for reading this article and for a hassle-free experience of purchase/sale of home feel free to get in touch".