Home Buying - It Ain't Over Until The Fat Lady Signs

First of all, don’t take offense to the ‘fat lady’ reference. I have no problem with overweight people, but once you hear what this condo seller did to us, you’d be calling her names too.

As many of you know my girlfriend and I were in the process of buying our very first condo. Everything was going extremely smoothly. In hindsight I probably should have been apprehensive about that smooth sailing. Something was bound to go wrong and in the worst possible way.

So pretty much everything was complete…confidence building home inspection – check, accepted offer – check, negotiated mortgage – check, moving van rental from United Van Lines secured for 2 days – check, home owner’s insurance arranged – check, final papers signed with a notary – check. Final papers signed by the seller…not so much.

As we were getting closer and closer to moving in, excitement was really setting in. Maybe we were planning too much and counting our chickens before they were hatched. Can you blame us when everything seemed finalized to us?

Then on May 29th we find out that the seller was unable to get her bank to discharge her mortgage. After owning the condo for years she somehow owed more on the condo that she agreed to sell it for. My theory is that she funded her recent divorce with the equity in her home. She claimed to be unable to secure a loan to cover the difference. Umm…why the hell are we finding this out days before we were set to move in?? Why the hell did she accept an offer that she should’ve known was lower than what she owed??

Now in the US this may be a more common scenario since the housing collapse. Here in Canada, especially Vancouver, this just doesn’t happen. With housing prices around here constantly increasing, it’s very unlikely for someone to owe more on the mortgage than they can sell for. When someone has had that mortgage for years, it is even more unlikely. Her bank happens to have a mortgage plan that instantly gives you access to all of your home equity at any time. I know because my planned mortgage was with the same bank and had the same setup.

So imagine the feeling of having the rug ripped out from under you just a few days before you were to take ownership of your first home. Saying it was a whirlwind of emotion would be an understatement. First we were trying to hold out hope that she would come up with the money before the actual closing date. When the closing date came with no positive news, we were both so pissed off. This lady’s stupidity was seriously screwing us over. Then came the sadness when we had to accept that we weren’t getting the condo. As our realtor suggested different strategies to force the sale through, this whole whirlwind repeated itself.

To make matters worse, the seller was being very unresponsive with her realtor. Everyone was just left in the dark about what was going on. On the closing date, her realtor even tried to track her down at her job to try to get some kind of answer. Couldn’t she at least have the decency to be more upfront and admit her mistake?

During this whole ordeal we just couldn’t wrap our heads around how this could happen. Giving her the benefit of the doubt that she wasn’t straight up heartless, we could only assume that she was just naive and stupid. Was it that simple though? In the back of our minds we got wondering if there was something more to it. Could she maybe be wanting us to sue her so that she could go bankrupt and get out from under her mortgage? Or did she have a messy divorce making her want to ruin her ex-husband who was still the guarantor on her mortgage? Did someone tell her that she sold for too low and could get a lot more if she did renovations or waited it out? Knowing she still moved out at the end of the month just added to the suspicion.

Most likely we’ll never find out what the truth was. I’d love to sue her ass to get back every penny spent and to get compensation for the wasted time. In reality though, it would be far too expensive and there would still be the possibility of her filing for bankruptcy. Because the bank technically owns the condo, we might not be able to get ownership via the courts either. We do fully intend to take her to small claims court where we can recoup some costs without lawyer fees.

Another frustrating part about this all is that it nearly left us temporarily homeless. We had already given notice to move out of our rental apartment with someone else scheduled to move in. So as the deadline was nearing on the closing date, we had no choice but to scramble to secure a backup plan. Technically we could’ve stayed at a hotel and sued the seller for that expense, but why risk it when we might never recover the money. Fortunately we were able to find a rental apartment that allows 2 cats and would let us move in the very next day. At least that was a relief.

Really I should be more bitter about this whole mess, but we’re trying to stay positive. On the bright side, there were some things that were less than ideal with that condo. Also we had never lived in that suburb. So this is our chance to rent there to see if we could live there long term.

A big part of me is still pretty damn pissed off though. I had to bite my tongue not to make this post a big swear-fest. Sure it might not have been the ideal condo, yet we wasted so much time, energy and money pursuing it. We might get the money back, but the time is gone forever and now we have to go through it all over again now. Plus there is more work to undo everything that we did complete. With any luck we’ve learned some things to make it go smoother. Luck sure doesn’t seem to be on our side these days though.

What do you think the seller’s story really is in this situation? Have any of you had to deal with something like this? Would you still be tempted to take her to court for breach of contract?

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