If a seller signs an estimate, does that mean they agree to the buyer’s offer?
I was asked to resolve a dispute between two salespersons, Alice and Bob, who work together as a team. Bob never let his sellers sign the seller’s estimate of closing cost because signing would be the equivalent of the sellers accepting the buyer’s offer. Alice was surprised to hear this, but by the time she got around to calling the hotline, she had pretty much been persuaded by bully Bob.
Q. Does the sellers’ signature on an estimate of cost bind the sellers to anything?
A. No. Signing the estimated closing cost sheet is nothing more than an acknowledged receipt of the estimated closing costs. This question represents one of the many myths I’ve heard from time-to-time while answering hotline calls; akin to the myth that a contract without a deposit is not binding.
The requirement to provide the sellers with an estimate of reasonably foreseeable expenses associated with the sale of real estate, comes by way of the rules and regulations of the State Real Estate Commission (SREC). In fact, the rules include a form that is “exemplary of the requirements” that the SREC expects to find and on that form, you will find a place for the sellers to sign. Look at the PAR Standard Form Seller’s Estimated Costs (Form SEC), and you will see several statements above the sellers’ signatures indicating that the form is based on the best information available at signing and that the sellers have received it before signing an agreement of sale.
When someone tells you that your practice violates a rule or is “illegal” or something to that effect, ask the source of your critic’s information. Can he or she cite to an article or statement found in a treatise or textbook that supports their assertion? Can they point to a case or a ruling that will serve to verify the truth of what you are told? Or, call the hotline.