QUESTION
Age 65, From Michigan. Can we get out of Purchase Agreement after an inspection revealed major problem with septic system?
Asked on Jan 04th, 2017 on Residential Real Estate - Michigan
More details to this question:
PA signed by both parties. We made a cash offer w/$500 deposit. Concessions made by us (buyer) at sellers request. Sellers did not provide Disclosure Statement initially and was it requested by us a couple times. We paid for home inspection which found age issue with roofing (price adj.) and we wanted a well/septic system inspection (seller paid). There was/is an encroachment issue resolved by survey which seller's realtor states he now paid for. The well/septic system was delayed by sellers up to the point of actual closing. Inspection results were that the septic system is compromised and the drain-field is failing and would need to be replaced. Estimated cost: $6,000. for the drain-field alone. Seller asked that we pay for 1/3 and they would adjust price for the balance. Again there is no price guarantee. They did not want money in escrow for repair. We decided to walk away. We asked for our $500 to be released. They want the deposit or they will sue. Should we concede? Thoughts?
1 ANSWER
Real Estate Law Attorney serving Holland, MI
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Cunningham Dalman
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The right to the deposit would depend upon the language of the PA and the Seller Disclosure Statement. If the seller has not provided an SDS, you have the right to terminate and get your deposit back. In this case, I would hold firm on the return of the entire deposit.
If the SDS has now been provided, but the well/septic section of PA allows you terminate if not satisfied, you have the right to the deposit back. The PA may not be all that clear if the seller has made a "reasonable offer" to fix the problem. The seller needs a release so he can market the house to others and you need a release so you can put an offer on another house without fears of action over this one. In this case, I would push back that you get the deposit and wait a few days for the seller to come to his senses. But if you find another house you want to move on, it would be worth $500 to have this PA firmly put to bed first.
Answered on Jan 09th, 2017 at 5:22 AM