Problem with Purchase Agreement that was Assigned

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Problem with Purchase Agreement that was Assigned

Travis D.
Wholesaler · Montclair, NJ · Member since 2012 · 25 posts · 2 votes

So I'm interested to get some feedback and guidance on an delicate issue I have right now. I put a property under contract and it so happened to be one that was vacant for 3 yrs and the sellers were still moving personal items out of the house but would ultimately be leaving most of their debris/rubbish come closing. I have in my purchase agreement as part of my inspection clause, "Unless specifically excluded in this agreement, all other items of personal property located in or on the property shall be included in the sale. This clause shall survive closing of title".

Well, I've since assigned my contract (got 1k deposit to my company, 2k deposit to title company escrow, and getting another 9k @ closing) and the new buyer is expecting to keep all the items in the house, when I had a previous understanding with the seller that we would just remove anything they left post closing.

What I'm asking is does the new buyer actually have rights to the items the Seller hasn't yet removed? How do I work around this to make sure the Sellers do not lose rights to it but also prevent a legal issue with the Buyer. Do I have legal liability in this situation? Your thoughts and feedback would be much appreciated.

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Account Closed
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
14y

Travis: Your buyer/assignee takes over all terms of your contract. If your contract says the stuff at time of inspection is yours and nothing was excluded, it's now the buyer's at closing. I'm assuming the buyer/assignee read the contract and thinks the stuff is his at closing

Did the seller read and understand what they signed? Why did you have a seller sign a contract that didn't exclude anything, if you knew they wanted the stuff?

I'd get on the phone with both parties and figure out what the sellers expect to keep and work with the buyer to change the terms of the contract. Maybe the sellers don't want to keep that much. Maybe the buyer doesn't care that much. But I'd fix it asap.

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  • Account Closed
    Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
    14y

    Travis: Your buyer/assignee takes over all terms of your contract. If your contract says the stuff at time of inspection is yours and nothing was excluded, it's now the buyer's at closing. I'm assuming the buyer/assignee read the contract and thinks the stuff is his at closing

    Did the seller read and understand what they signed? Why did you have a seller sign a contract that didn't exclude anything, if you knew they wanted the stuff?

    I'd get on the phone with both parties and figure out what the sellers expect to keep and work with the buyer to change the terms of the contract. Maybe the sellers don't want to keep that much. Maybe the buyer doesn't care that much. But I'd fix it asap.

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  • Jerry PuckettPro Member
    Wholesaler · Fort Worth, TX · Member since 2010 · 1k+ posts · 1k+ votes
    14y

    I had the exact same issue with a house I sold last summer. Well, almost exactly.....it wasn't part of my inspection clause, it literally said anything left behind after closing would be mine.

    The problem was, when I showed the house to the buyer, there was still quite a lot of stuff inside the house. Looked like junk to me, but you know the old saying: "one man's trash is another man's treasure." I didn't bring it up, and it was never discussed, but while I was busy assuming the Buyer would want none of it, the Buyer was busy assuming she could have all of it.

    Turns out the buyer was the head of a non profit that disburses clothing and furniture to the needy. It came to a head one day when buyer and seller bumped into each other at the house. I had a lock box on the door, and they each had the code to take care of their respective business. Both called me a little perturbed....

    But as K. Marie said, I negotiated between the two. Turns out the seller really only wanted a few items with sentimental value, and the buyer was willing to give a donation statement so the seller could write the rest off on her taxes. Win/win.

    Actually, win/win/win, because now I have a non profit with trucks and volunteers that will come and unload houses for me, AND offer a tax deduction to a seller. That's a nice little chip to negotiate with.

    But in the future, make it a point not to offer a verbal agreement before or after a contract is signed...it's unenforceable when your contract says "this is the sole agreement between parties" or some such, like most do.

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  • Travis D.
    OP
    Wholesaler · Montclair, NJ · Member since 2012 · 25 posts · 2 votes
    14y

    Thanks you both very much for the feedback. It was a pure oversight to not include the items they wanted in the contract and I'll be sure not to make that mistake again.

    Jerry, that's a great resource and idea to have to remove items from properties. I'll be sure to keep that in mind. As it stands now, the Buyer is asking the Seller to provide a list of items they plan to remove along with a value of those items. The Buyer will then ask the Seller to pay for 1/2 of the value of the items as a line item on closing statement. I feel it was my error and responsibility so I'm working with the Seller to eat as much of that cost that is reasonable.

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  • Account Closed
    Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
    14y

    Travis: glad you are getting it all worked out. What is in that the house that's causing the buyer to ask for compensation? Is it full of antiques? New appliances? Art? What kind of values are we talking about here?

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  • Travis D.
    OP
    Wholesaler · Montclair, NJ · Member since 2012 · 25 posts · 2 votes
    14y

    Yes, mostly paintings and antiques. Not like a gallery's worth but a few that the Seller who is an artist had kept at the house. As far as antiques, some lamps that are supposedly worth over $1000 each. The new Buyer is asking for a breakdown of the value of each item they are removing from the house. I'm estimating the total value to be about 7-10k worth of stuff, thus I'll be paying 3500-5000 out of my assignment fee. Very upset with myself as its a costly mistake. Any other suggestions in a situation like this?

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