P&S Agreement - Assessment Paid by Buyer?

[KG]

Hello...I have a question was wondering if I might have some posters chime in on...we're honing in on a new construction house that has sat on the market for about 2 years. It's a great house, well built.

The seller is the developer and also acting as realtor. When he built the house he put it on town sewer which is great.

We have gone back and forth with him on a sale price (about 12% below his list price) and are pre-approved. He sent the P&S over yesterday. The agreement itself is typical, but there is a Rider attached with our list of things we want him to do (minor tweaks to paint, fixing any cracks in walkway, etc.). The last item on the Rider was that the seller assumes the amount owed to the town for the betterment assessment.

We did a little investigating with the town and found out that this is the assessment from hooking the house into the town sewer and it is for $5,500. Never once when we discussed the house was this mentioned before we saw it on the rider, nor does the rider stipulate the amount (which we got from the town).

I understand from my legal dream team that this is something the seller typically pays, not the buyer. I wondered if anyone else had experience with this in their negotiations. Frankly, $5,500 is going to cut into any money we had to get furniture/settled into the house and I am a little annoyed we're only finding out about this now.

Anyone have any experience with this or a suggestion on how to push back?

Thanks!

[KG]

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@KG wrote:

Hello...I have a question was wondering if I might have some posters chime in on...we're honing in on a new construction house that has sat on the market for about 2 years. It's a great house, well built.

The seller is the developer and also acting as realtor. When he built the house he put it on town sewer which is great.

We have gone back and forth with him on a sale price (about 12% below his list price) and are pre-approved. He sent the P&S over yesterday. The agreement itself is typical, but there is a Rider attached with our list of things we want him to do (minor tweaks to paint, fixing any cracks in walkway, etc.). The last item on the Rider was that the seller assumes the amount owed to the town for the betterment assessment.

We did a little investigating with the town and found out that this is the assessment from hooking the house into the town sewer and it is for $5,500. Never once when we discussed the house was this mentioned before we saw it on the rider, nor does the rider stipulate the amount (which we got from the town).

I understand from my legal dream team that this is something the seller typically pays, not the buyer. I wondered if anyone else had experience with this in their negotiations. Frankly, $5,500 is going to cut into any money we had to get furniture/settled into the house and I am a little annoyed we're only finding out about this now.

Anyone have any experience with this or a suggestion on how to push back?

Thanks!

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Sorry I meant to say that the last item on the Rider was that the BUYER assumes the debt owed to the town for the betterment assessment - slight difference!

[DallasLoanGuy]

Do you have a realtor?

Sounds like they tried to slip one by you.

A person without a buyer's representative has a fool for a realtor.

[KG]

Yes, we think that too.

We're acting on our own, but with lots of help legally (I have two real estate lawyers and one former loan officer in the family). Two of them think this was not a nice move and don't like the way he did it. One of them somewhat understands that he probably doesn't feel he should pay it because he does not get the benefit of it.

I feel the benefit is that he pays it, he gets a sale! I just don't know how to push back on this. And thought it was a somewhat sneaky move on his part. Like we weren't going to find out from the town that it was $5,500? Good lord.

[Lel]

Fundamentally, the builder/seller didn't do anything illegal, but he is asking for something that sounds unconventional.  It seems that for the home to be functional at all, this hook-in and assessment is required.

But then again, many real estate transactions have atypical features about them - think about the "as-is" sale of a home with multiple deficiencies that someone might assume that the seller should correct.

Good for you for reading over your paperwork carefully.  Lots of people have gotten themselves into trouble for not reading the documents that represent the single largest financial transaction that they will ever make.  It beggars the imagination that people wouldn't be a little more cautious about the process.

With respect to what to about this unexpected expense, there's no reason why you couldn't approach the builder and ask him to cover this cost.  It will likely lead to more negotiations, and he may not be willing to cover the entire cost, but you might be able to come up with a deal that satisfies you both.

If he won't budge on the assessment, then maybe you could ask him to cover the immediate cost of the assessment in exchange for an equivalent increase in the sale price.  That way a large part of the $5500 would be rolled into your loan and amortized over the term of the loan.  You'd pay interest on that amount, of course, but at least you'll still be able to furnish your home.