Worst purchase agreement I've ever seen. Lowball offer for less than a third of market value…read more
If you sign with them, be prepared for this:
1. Buyer: "The Dude Who Could Ruin Your Life" and/or assigns"
That "and/or assigns". He can flip the contract to another buyer or investor "without your consent". You think you're selling to "This Bad Dude", but it may close under a completely different name, or not at all. This is how wholesalers make money by reselling your contract.
2. 21 Business Days + Optional 30-Day Extension "Seller and Buyer ... on or before (within 21 Business Days)... Both Buyer and Seller agree to extend the closing date up to an additional 30 days..." That's up to 10+ weeks! with zero penalty if they delay. They can stall endlessly, usually to find someone else to buy your house. Meanwhile, your property is off the market.
3. Buyer Pays All Closing Costs "Buyer is to pay for all closing costs, including title company fees for the seller..." Sounds good but... The tittle company they use is commonly used by flippers/"investors" in Florida, It gives them control over the title company. They use a title agent who works for them, not you. That can mean slow communication, delays, or games with escrow funds.
4. "Management Approval" Clause "Offer subject to Management approval to be determined within 7 business days of acceptance." It means the deal isn't binding even after you sign. "We'll decide later if we actually want to buy." They can walk away during those 7 days with no penalty.
5. "Seller agrees to allow Buyer to market the property... to other potential buyers." They're openly asking permission to resell your property before they own it. They'll list your house online or show it to other investors to flip the contract.
6. "Buyer has the right to assign the contract (in lieu of assignment fee)." They're reselling the contract. "In lieu of assignment fee" means they can profit inside the price difference instead of charging a visible fee. You'll never see how much they made reselling your deal.
7. "Offer valid for 3 business days". Their way of rushing you, pushing sellers into signing quickly before they get legal advice.
8. "Buyer is purchasing as-is, no repairs required." Combined with all their outs, it means they can cancel at will if they find anything inconvenient.
9. "Buyer has a real estate license." Legal disclosure (required by law). This is a professional, not an ordinary buyer, and they know how to write the contract heavily in their favor.
10. "Possession to be given within 21 business days..." "Possession" isn't tied to a firm closing date. They could argue for access or marketing rights before closing.
11. No Seller Protections or Default Remedies. There's no penalty if they don't close after management approval or title clearing. You can't keep their deposit, sue, or relist freely without risk of dispute.
12. "Force Majeure" Extension "If an event constituting 'Force Majeure', Closing Date shall be extended." Force Majeure is normally for disasters, but vague wording means they can claim "delays" for almost anything and stall further.
13. "Cash, no contingencies for financing." Seems strong, but with all their built-in delays and outs, "cash" doesn't guarantee fast or certain closing.
14. "Offer subject to one inspection walkthrough during management approval period." Red flag: That means they'll bring in their "buyers" (other investors) for walk-throughs -- not inspectors. It's how they shop your home to others before closing.
No written permission for them to file a lien, but the way the contract is written, they could cloud your title using a memorandum -- which is exactly what some predatory investors do if you back out.
Summary:
Purchase agreement written to trap your house while giving the "buyer" every possible way to: assign it to someone else for profit, back out without losing money, delay closing indefinitely, use your property to advertise for other investors. You could be stuck for months. The "Bad Dude" might never close. You might lose other real offers while they flip yours.
Definitely stay very far away from these people.