When a Sacramento Buyer Cancels Escrow it Opens the Door

Another door can open when a Sacramento buyer cancels escrow.

When a Sacramento buyer cancels escrow, it can be hard on everybody all around. I’ve recently had to resell three homes due to buyers who ultimately did not perform. In one case, the buyer had wanted to buy a different home but the seller of that home had chosen a better offer, so the buyer lost out. When that seller lost her buyer, her agent notified our buyer, and enticed that buyer to cancel and buy the home the buyer wanted in the first place.

It worked out for that particular buyer but my poor sellers, living in a mobile home in the middle of South Dakota and praying for a closing, are distressed. That listing is back on the market. Buyers don’t care much about the ramifications of the hurricane they leave behind.

In another escrow, the buyer decided the sales price was too high halfway through. We had several appraisals, one of which exceeded the sales price, but the buyer refused to close. The buyer’s agent was so certain it was closing, we thought it was OK to remove the home staging. We had to re-stage. Fortunately, we found another buyer who liked the home enough to step up to the table. But it delayed closing for another 30 days.

The escrow that just closed yesterday was a shining example of what happens when a Sacramento buyer cancels escrow. The buyer’s agent had stopped all communication. Both my TC and I emailed, called and sent text messages almost daily, and the agent simply ignored all communication attempts. Finally, after dragging it out, sending a Demand to Close escrow, the agent finally called to say her buyer can’t get the loan.

My seller was furious. After he calmed down, he offered to pay me extra to get him a higher sales price. That in itself would be called a net listing. It means if a seller wants, say, $300,000 and I bring him an offer of $350,000, I make $50,000. Which is ridiculous. I get paid enough. It’s called a commission. I rejected the seller’s offer and simply found him another buyer.

We had an FHA appraisal at our sales price. The buyer’s agent knew this, and his buyer was FHA, still he wrote the offer for more than the sales price. It won’t appraise for more. An FHA appraisal is assigned a case number and the next buyer will get the same appraisal. Instead, I suggested the seller counter with the buyer paying the difference in hard cold cash, in addition to making the sale strictly AS IS.

The buyer sent a request for repair and we countered with Notice to Buyer to Perform to remove inspection contingencies. The buyer realized the error of his ways and backed off. We closed yesterday.

When I called the seller to confirm our recording, he was ecstatic. All of a sudden, having gone through two escrows was no big deal. Hey, I sold the house twice and was paid only once. But that comes with the territory. When a Sacramento buyer cancels escrow, it means we don’t abandon our sellers because of it and they should not abandon their listing agent either. It’s a two-way street.

In the end, my buyer received another $3,000 for his property for waiting another 30 days to close. Although he was unhappy at the time with the buyer who could not close, the next buyer paid even more. As long as he is happy, I am happy.