Question about buying from divorcing/divorced couple

papergirlMarch 7, 2012

This is my first time buying a house so please excuse my lack of knowledge on this subject. We put in a written offer on a house today. It is in the $300,000 range and we offered $20,000 under asking price with a closing date next month. The seller's realtor got all bent out of shape before she even showed the offer to the seller. She lectured my realtor about reasonable offers and just overall seemed personally offended. We were actually willing to meet in the middle somewhere, but we thought we would start a little low to see how it went. The house is beautiful and has a lot of nice upgrades, but it has a completely unfinished basement (no studs, no insulation). It has been on the market 2 months. Average around here is 3 to 4 months but in that price range they can sit for over a year.

The sellers (who are either getting divorced or recently got divorced) gave a verbal counter of $6000 under their asking price. We gave another verbal counter of $13,000 under their asking price. Their realtor texted ours and said that will not work. They are sticking with their original counter of $6000 under asking price.

My question is this - is it possible that the sellers divorce decree states that if they get a written offer for X amount they must take it? I'm just wondering if they are trying to avoid seeing the written offer for some reason, because I think it's a reasonable offer and so does our realtor. A house one block away that was built in the same year is listed at $240,000, also with an unfinished basement. It's not as nice, but it's only 300 square feet smaller and if it sells it's a comp.

I realize that in a divorce situation maybe the person living there doesn't really want to sell and is therefore not willing to budge much on price. There are so many possibilities. Maybe they can get a better offer, but I still don't think our offer was unreasonable. My realtor sold a house in the same neighborhood recently with a finished basement and it only appraised at 280k. I also wonder if there is something fishy with their realtor. I plan to submit our best offer in writing regardless of what their realtor says about our verbal offer. Just wanting some input from all of you with more experience than me! Thanks.

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Write it up.

Or, if you can stomach losing it. Let it sit for 2 more months, then write it up again.

    Bookmark   March 8, 2012 at 1:16AM
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If their realtor mentioned that they are divorcing, she really is not serving them well. I would absolutely not hedge any bets on what their divorce decree may or may not say. Offer what you are willing to pay for the house and see how things go.

    Bookmark   March 8, 2012 at 8:12AM
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Negotiating with two parties that may be 'at war' with each other can be a real PITA.

Either can kill a deal by refusing to agree and sign.

The divorce court can order the recalcitrant party to pay the other, or sign, but it drags things out if ot goes that far.

Be sure you get an owner's title insurance policy if you buy from them (the required lender's policy protects the mortgage holder, but not you).

    Bookmark   March 8, 2012 at 9:46AM
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Verbal counters mean nothing. Get it in writing. Personally, I think they are feeling you out to see how far they can push you towards their list price. If this house is still on the market after two months its doubtful its priced under market value.

As for their realtor "lecturing" yours, that's BS! Its her job to present received offers to her clients. If they were so offended by your offer, they didn't have to respond. I think they may realize that you are not a seasoned buyer and are trying taking advantage of that.

Its all about comps. Take emotion out of it and keep it strictly business. There are too many properties available to get caught up in whatever games they are playing. Your offer was reasonable. Period.

Moving forward, I'd put a time limit for response and also make sure your contract has as many protections in it for YOU as possible.

    Bookmark   March 8, 2012 at 10:37AM
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If you were willing to meet in the middle, why did you counter with $13k under asking instead of $10k? That extra $3k can make a big difference. If they are divorcing, they are obviously watching every penny. I understand you are trying to get the best deal, and that is within your right. If you look at it from their perspective, they are probably losing their dream home at a bargain basement price, and they find that insulting. I know it's a business transaction, and people always say leave your feelings out of it, but buying and selling a house IS an emotional thing.

We had looked at a house where it was pretty obvious they had recently divorced. The whole house felt cold and lifeless. Maybe other people would have snatched it up because they could assume they were in a hurry to sell, and they could get a good price. Not us. I know it may be silly, but we figured whatever vibes were going on in that house that caused a divorce and shattered lives - we wanted no part of it, no matter what the price.

    Bookmark   March 8, 2012 at 11:23AM
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Thanks for the input. Next week we are going to put our best offer in writing, which is 12k below their asking price. I wouldn't mind going 2k over that but my husband absolutely refuses. He might consider it if they throw in their washer and dryer but I hate to bicker over something so trivial.

Thanks brickeye for suggesting owners' title insurance. I will ask our lender about that. I hope these people budge a bit because theirs is the only house I want. Our house sale goes through next month (it was new construction 8 years ago so we are homeowners but have never dealt with sellers before). If we cant get this house I would like to rent until I fall in love with a new one or until they lower their price.

    Bookmark   March 8, 2012 at 2:10PM
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"I hope these people budge a bit because theirs is the only house I want. "

I understand, but letting emotion get into a transaction like this is just not a good idea.

    Bookmark   March 8, 2012 at 2:16PM
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Get everything in writing! Accept NO verbal stuff. Sounds like their realtor is part of the problem Your realtor should stand his/her ground and not accept this attitude. DO not be afraid to walk away. Something better with less problems is out there. DO NOT let emotions get in your way. If you want the washer/dryer etc, put it in writing. If you went into a store to buy clothing, appliances etc, the sales person would not say--oh it is more etc. This is your money, be firm etc. And by the way, you may want to get some legal advice, especially if the divorce is not final. Who knows what the final terms will be. Protect yourself. Again, list everything in your offer--appliances, curtains, drapes, etc. Then on your final walk thru, before any final papers are signed, take pictures to make sure what you bought is still on the premises

    Bookmark   March 8, 2012 at 2:35PM
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Yes, especially in a divorce, make sure it all stays. A friend of mine bought a house and the wife, who still had a key, went in and took all the door hardware off in the entire house between the walk through and signing the papers.

    Bookmark   March 8, 2012 at 5:48PM
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Here, we write up the initial offer, then counter back and forth verbally until in agreement. I then write up a new contract with the agreed upon terms.

    Bookmark   March 8, 2012 at 9:13PM
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That is a great idea to take photos before closing. Thanks again for all of the great advice. If we do end up buying this place it will be very helpful.

So apparently I'm one fickle b*?ch because I am now loving another house, haha. It's a new build with a view that we looked at this summer at an open house. I always loved it but my husband did not. I think the price was just scaring him off. The builder has it quoted with expensive flooring and granite in the kitchen and bathrooms and a finished garage but I don't care if I have granite and a finished garage if I have pretty wood floors. I can compromise!

I'll just show the builder photos of the house we made an offer on and tell him, "This is my taste, let's make it happen on a budget!" My husband and I had really wanted to build awhile back so we did quite a bit of planning, including buying blueprints, so I feel like this could really work, plus the list price is not too far from where we want to be. My realtor is checking it out for me and will show it to us very soon. I'm bringing my tape measure. :)

    Bookmark   March 8, 2012 at 9:23PM
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Take it from someone who has been house shopping for 5 months. Give written offers only! Makes a big difference.

The house we are finally getting is also a divorce situation. They listed at $267,900. We wrote an offer for $243,000. They countered at $250,000. That's a $17,000 drop with the first offer. We wound up at $245,000 which I still think is high.

We are awaiting an appraisal report. If the appraisal is lower, we will not pay above the appraisal price. It should be close, but it becomes another negotiating tool.

Look on Zillow. Put in the address and you can see what they paid for the house and when they purchased it. It will also show other homes which sold recently. Gives you an idea if you are in the ball park.

Good luck whatever you decide,

    Bookmark   March 8, 2012 at 11:29PM
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"Look on Zillow."

Notoriously inaccurate.

"Put in the address and you can see what they paid for the house and when they purchased it."

What they paid has little to do with present value.

Your RE agent should be able to pull up recent closings that you can then try to compare to estimate value.

    Bookmark   March 9, 2012 at 9:29AM
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It seems you are $6000 apart on the price. This is not a big amount to overcome in the negotiation.

Add the washer and dryer to your counterprosal. See if there are anything other items the sellers would like to sell as part of the deal. Let the seller's realtor know you are going to make a best and final offer, and you are prepared to move on if a agreement can't be reached.

    Bookmark   March 9, 2012 at 10:16AM
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Thanks for sharing your numbers Jane NY. I really didn't understand why the other realtor seemed offended because I thought our offer was a good starting place! That realtor actually apologized to my realtor for the way she reacted, so that's good at least. Congrats on your purchase!

Brickeye you are right that zillow can be inaccurate - they had their zestimate of our current house at $290k about a year ago and now it's at $159k with no explanation. However, they do have our tax assessment and taxes paid listed correctly. Zillow is also a good place to find out how long houses have been on the market and how many times they have been re-listed. Their zestimates mean nothing to me though.

At this point I'm almost glad they didn't accept our offer because I'm so excited about the possibility of getting this unfinished house with the great view of the city and river. However, if we can't make a deal on this new house I will go back and put our final offer in writing on the first house. Thanks again to all of you for your input. Kind of makes me wary of buying from a divorcing couple!

    Bookmark   March 9, 2012 at 7:41PM
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Considering the divorce rate, I'd assume that buying from a pair who is splitting is more common than you'd think. Actually, it can work to your advantage more times than not. Not many couples want to prolong the agony and if they have equity in the house or are shelling out for new housing, that sale could be a Godsend. Or, like Brickeye says it could be a PITA. You don't know what they agreed on when splitting up the bootie. Maybe one has a cash settlement to pay to the other and needs a specific amount from the property to make it.

    Bookmark   March 9, 2012 at 8:56PM
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When you submit your next written counter, put a time for acceptance on it. Give them 24 hrs to respond. This prevents you from sitting and fretting and it will force their hand.

    Bookmark   March 10, 2012 at 6:18AM
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Short time limits also limit 'shopping' of your offer to other buyers.

    Bookmark   March 10, 2012 at 2:30PM
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Something just happened here that could mess the sale up. A friend was getting a divorce from her spouse, signed the house to him, he was paying for it, and he passed away. Now everything is up in the air as is kids from his first marriage, are refusing to pay any of his bills. Not sure how it will effect the sale (which is pending), but everything is on hold until his estate is settled, which in this case could take awhile. She does not want the house back, which is in bad condition, has been told she has to pay all his bills etc. What a mess!!!

    Bookmark   March 10, 2012 at 7:53PM
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"kids from his first marriage, are refusing to pay any of his bills. "

The estate is responsible for the bills, not the children.

The bills must be paid using ay assets in the estate, but if it runs out of money the creditors are likely out of luck.

Any assets must be used to satisfy the debts though.

House, cars, stocks, bonds, etc.

That would mean the heirs get nothing.

    Bookmark   March 11, 2012 at 11:46AM
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"A house one block away that was built in the same year is listed at $240,000, also with an unfinished basement. It's not as nice, but it's only 300 square feet smaller and if it sells it's a comp. "

I'd suggest that you have your realtor show you this house and talk up how much you like the house and how overpriced the house you've made an offer on is. You may even consider having your realtor prepare a low offer the one for $240k and/or including it as a comp justifying your original offer price.

    Bookmark   March 16, 2012 at 10:56AM
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