I'm really hoping someone can help me out on this one. I'm a first-time investor, purchasing a foreclosure, and I'm concerned that if I back out of this contract, I may not get my earnest money, even though it appears the seller (the bank) has done illegal things. I realize I may be wrong, considering I'm a newbie.
Here's the story: I found a foreclosure that was listed at $105K. It needed a fair amount of work, so I offered $82K Cash. The very next day, the listing agent told us that our offer was approved! Unbelievable, right? We were thrilled, and sat waiting, and waiting for a contract to sign. So, about a week and a half later, the listing agent told us that the INVESTOR (who apparently had to give final approval) was now saying that they could NOT accept $82K, and that they could accept $84K (since that was 80% of the listing price--I'm rounding off all numbers here btw), and that we had to agree to having no due diligence/inspection period. Hmmm, ok, we could buy that, but it sucks that we sort of got lied to right off the bat. So, we proceeded to say OK, we'll pay $84K.
So, we waited, and waited, and waited for a contract to sign. THREE weeks later, the listing agent told us that the seller (the bank or the investor, who knows?!) was now saying that they could not accept $84K, and that now they would only take $89K. Ummmm, that was weird. They basically just countered themselves. And they lied again. We were weirded out, but I really wanted to get this house. So, I convinced my husband that we should accept the $89K, but ask for the inspection/due diligence period back. So, we accepted, and waited, and waited. FINALLY, we got a contract to sign on Friday, July 28.
We signed, and got an inspection 3 days later, on Monday, July 31. While we knew the outside AC unit was missing, and we knew of just about all the other issues, the one major thing we learned from the inspection was that the heat pump was missing from the attic. That's a big expense. That same day, we sent an amendment to the seller, asking for $7k off the price, bringing it to $82K. After 3 days, on Thursday, August 6, we got a response from the listing agent, saying the seller agreed to a new price of $86K. We agreed, that same day, and sent a new amendment to them that same day. We waited all day Friday, which was the last day of our inspection/due diligence period, and heard nothing. So we basically had to make a decision about terminating, based on the seller's (and the listing agent's) word. And they had a history of lying. But I wanted to trust them so bad, and figured that they never would've given us that price, knowing we were in the due diligence period, without sticking to their word, since it would now cost us money.
3 days later, after some badgering from our agent, the listing agent said that the seller had approved the $86K, and so did her boss, and she would be signing it off today. Well, today is here, and we just got told that the INVESTOR did not approve it, so we are stuck at $89K! What the?! Seriously? So, now it appears the listing agent is partly at fault because we were NEVER told that we had to wait for investor approval, and we were told that it was approved. This boils my blood that they could be so careless and unethical.
Are we screwed now? I want to back out of this deal. But are they entitled to our earnest money, even though they lied to us? And we had to make an UNinformed decision whether to terminate? Is there really NO ONE that they have to answer to? This is insane and so shady!!! Please, any advice you have is hugely appreciated. I'd like to go see an attorney (I'm in GA), but I don't want to waste his/her time if I'm S%$ out of luck.
