A REAL ESTATE ROLLER-COASTER RIDE

A REAL ESTATE ROLLER-COASTER RIDE
The dire consequences of not getting legal advice.

Let me tell you about my real estate roller-coaster ride.

I had a couple of agents give me an idea of the value of my home. Both said it was worth around $350,000. I couldn't believe my little 2 bedroom home was worth that much.

I chose not to sell as I felt my best option was to extend - which, looking back, would have been the right decision.

I got a few quotes from builders and then went to the bank to arrange the finance. As part of this process, the bank required a valuation of my home. My home was valued at $320,000. I was told that a bank valuation was conservative, which made me believe the agents' figures of $350,000.

I went home and did my figures and thought if I sold my home and bought another with the added rooms, I would not have to go through the awful process of extensions.

The next day, I found a home which I thought was fabulous. I couldn't believe my luck. The house was advertised for $290,000 - $320,000. The agent explained he already had two offers.

I said I loved the house and tried to get a notion of what amounts had been offered. The agent said it was between $300,000 and $310,000. I said I could offer more.

The agent was aware my home would need to be sold in order for me to purchase the new home. He came straight over to see my home and confirmed that I would have no trouble selling it. He drew up a sales contract to buy the new house which I signed - my major mistake!

A friend recommended another agent to sell my home and so I took this advice and signed up for an auction which was to be held on the second of the month. I thought this was a good move as my settlement for the other house was not due until the 30th of the month. When I signed-up for Auction, I agreed to pay advertising of $2400.

The agent felt the figure of $350,000 was reasonable. However, the agent then advertised my home $300,000. I rang the agent asking why he hadn't advertised it for the price I wanted, namely $350,000. He said this was "the way it was done".

Over the next four weeks, the closest I had for an offer was $295,000. I began to panic and went to my bank manager, but could not get a bridging loan.

I went back to the first agent, from whom I was buying the home and told him what was happening. I was in a terrible emotional state, but listened to his advice, to take him on as my agent and to see his recommended Mortgage Broker.

So, I cancelled with the selling agent and gave my home to the agent that I was buying from.

The next day, I discussed my options with his broker, who felt she could get me a bridging loan, but at a huge financial cost.

At this stage, the love I had for the new house had gone out the window. I knew the owner of the house I had bought was on bridging finance because he, too, had bought a house prior to selling and would be very upset by my pulling the plug, but I felt this was my only option.

Then the legal angle - the seller of the home sued me and, six weeks later, I ended up having to settle out of court and losing over half my deposit plus my lawyer took a further $2,200 out for his fees.

So, finally, I am back where I started, still in my little two-bedroom home, except that I am a total of $14,500 out-of-pocket.

What a roller-coaster ride. I won't make the same mistakes again.



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This seller made almost every one of the major real estate mistakes. However, the greatest mistake was not seeking legal advice BEFORE signing a contract with the agent to buy a home.

Always seek legal advice before signing a contract to sell or buy a home. If not, you will be in grave danger of losing thousands of dollars.

Agents are salespeople, not lawyers. Do NOT sign sales contracts with agents.

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This story is taken from the Consumer Stories page of the Jenman site.



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