Buyers won't close due to "issues" during walk-through

Signed a contract to sell in May, limiting inspection to only major items. Buyers came back with mostly minor requests (which we agreed to fix anyway) but asked for a new driveway because their inspection flagged it as poor condition. We declined to fix or provide credits as we had another offer SUBSTANTIALLY higher (that came in just hours after we accepted their offer, so we could have canceled during attorney review but felt it was the wrong thing to do). Buyers agreed to move forward without any repair or credits.

They pushed off closing for a while because they were traveling, which we weren’t thrilled about. Some other red flags popped up as well. On the day of closing, their attorney emails our attorney asking for almost $50k because the condition of the property changed since their inspection, citing numerous issues. This was very clearly a money grab and nothing changed since the inspection. We were easily able to prove most of the issues existed previously with photos from before the house was listed. They dropped most of those claims.

However, they’re still claiming there is water seepage in the basement, and the contract says we will deliver the house free of basement seepage. We don’t agree that there is seepage and it’s our word against theirs. They refused to close.

After lots of back and forth trying to negotiate credits, we can’t come to an agreement. They’re not asking to walk away, they just want money from us. My attorney kept their deposit since they are failing to close and there isn’t any proof of seepage. The buyers of course want their deposit back unless we give them something like $35k in credits to close. They’re threatening to sue for the deposit back claiming we are breaching the contract.

Looking for some opinions on how to proceed here, and validation that we are taking the right approach. Our lawyer seems confident we can take damages out of their deposit, and that we should re-list the house and find a new buyer. He isn’t a litigator though, so I’m not sure his opinion on our likelihood of winning in court holds a lot of weight.

I’m debating bringing in an engineer so we have an “official” opinion that there is no seepage, although it seems the burden of proof is on the buyers to show there is an issue. I don’t think it would get them to close, it might just be useful in court.

Thanks for the feedback everyone. Lots of mixed opinions. Most popular answer seems to be “listen to your attorney” which is the course we will continue to take. I’ll also be hiring an independent third party, that’s both a licensed inspector and professional engineer, to perform their own investigation. I’m extremely confident they will not find seepage and it will help bolster our case in court. I’ll also be getting a second opinion from a litigation attorney as to our odds of winning. We have detailed records of the long list of issues the buyer brought up during the walk-through, and then later admitting that most of them are inadmissible, which will help to paint a clear picture of their intentions.

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I had this same thing happen when I sold 3 years ago. Buyers got cold feet and after the final walkthrough came up with all sorts of “issues” like… a jar of garlic left in the fridge and cans of paint left in a closet. It was touch up paint… wanted to delay closing for minor holes in the walls from picture frames, etc.

Lawyer said to please advise if the buyers will be sending the funds for closing or if they will be forfeiting their $20k in earnest money. They sent the funds right away.

It is extremely important to have a substantial amount of earnest money for closing and to have a lawyer.

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Stop trying to pass the buck on what is clearly a known issue. Even with your one-sided explanation, you are admitting that you have to run a dehumidifier to keep the basement in check.

You are hesitant in getting an engineer out since you’ll have to disclose any issues they find to other potential buyers.

You are not a victim. Stop acting like it.

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Ask your lawyer to break to sale contract with them, you do not wish to do business with them.

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Broker here. Keep the security deposit until they sue. It’s not like it’s free to have an attorney. Once they realized it’s costly and they can’t get that much back until they win or 2-3years and thousands of dollars later, they’ll settle (getting partial money back) or buy the house.

Also, never delay a close. They could have a power of attorney to sign the paperwork.

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Good advice. We proposed signing the paperwork remotely. They insisted on being here for the walk through. I should have caught that red flag. They were planning on doing this from the beginning.

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Can you provide evidence of days not listed as evidence of a fee from earnest money and itemize it and deduct most based on days of house not listed and return part of it. If they claim it is not accurate you have evidence of what you are keeping earnest money for more clearly.

It’s a mostly win solution but keeping all of it in some cases they will tie you up in litigation and may hinder your ability to sell to new buyer though I’m not sure if they can put a hold on your sale to a new buyer.

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I don’t expect to keep all of it, nor do I feel that’s reasonable. I want to keep whatever makes me “whole”, and have no problem itemizing exactly what that is.

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Work with your real estate attorney. You have the buyers from hell. Your attorney can make sure everything is done strictly to the letter.

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Get a professional report stating no seepage. Keep deposit. They have burden of proof, which they won’t have.

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Are there any real estate agents that can talk any sense into the buyer side? I would hold my ground. They would have to prove there is water seepage to get any claim to their deposit.

I’d hold my ground and be talking to the other offer and let them know there is a chance you will be going back to market.

Whatever you do, do not give them their deposit back. Make them prove a seller default.

It sounds like a weak bluff to me, but it could be a stronger bluff. You just have to call it and hold your ground. Be ready to go back to market. Fuck them in other words.

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