Is NJ trying to outlaw seller concessions with Opinion 710?

doug · Joined: 07 Jul 2006 Posts: 7 1.92 Dollars($)

I understand the law stands in front of the NJ Supreme Court and it is a rulling that can stop the use of seller concessions in NJ. Has anyone seen or read anything about this? Supposedly this has been going on for close to a year.

gmakerley · Posted: Wed Jan 30, 2008 8:19 am Post subject:

i had not heard anything previously about this. hence, i googled opinion 710 and i discovered that the opinion is just that...an opinion of law. i did not find any evidence that this will strip buyers and sellers of the opportunity to negotiate concessions. what the opinion addressed is a specific instance in which a sales contract was manipulated in order to bypass a lender's maximum loan guidelines.

clearly, any efforts by buyers, sellers or their legal representatives to fraudulently affect a purchase price ought to be outlawed. the use of seller concessions is not at all fraudulent.

i hope this is sufficient clarification.

doug · Joined: 07 Jul 2006 Posts: 7 1.92 Dollars($)

Thank you, I do agree. I have an attorney suggesting a client not use the seller concession in his purchase because of the unknown future of the opinion. I think he is being overly cautious.

gmakerley · Posted: Wed Jan 30, 2008 8:33 am Post subject:

"overly cautious" may be an understatement also, doug.

if this case has been around for a year, as you intimated in your original post, then these cautious lawyers would have been eliminating concessions throughout that period.

i trust they haven't done that. we certainly don't find this happening in connecticut.

doug · Joined: 07 Jul 2006 Posts: 7 1.92 Dollars($)

This one attorney and his firm may have. I'll have to ask him. He does instill some fear in his clients or at let the one I am working with.

I'll keep you posted,

Jessica

Hi Doug,

So far as I understand, it isn't illegal to ask for seller concessions in New Jersey. However, the Opinion 710 came into being because a section of attorneys involved in real estate transactions were raising the home sale prices and then making the sellers pay for the buyers' closing costs. This is indeed a kind of fraud and in order to prevent this, there may be some attorneys who have stopped considering seller concessions.

However, it isn't against the law if the buyer is indeed unable to pay for the whole/part of closing costs and seeks the seller's contribution there. What I mean is, there should be proper negotiations between the buyer and the seller.

Regards,

Jessica

Guest 0.10 Dollars($)

Thank you for your input. I have a very scared buyer who needs the assistance from the seller and the attorney has put the fear of going to jail in his head. He has since decided to go with the assistance but now the attorney may not represent him. There are many attorneys that I have spoken with who don't think my buyer is breaking any law. Thanks

Jessica · Posted: Thu Jan 31, 2008 11:56 pm Post subject: RE: not breaking the law

lisascherzer · Joined: 04 Jan 2008 Posts: 599 69.56 Dollars($)

Hi Doug,

If the home is purchased at or below the listing price then seller concessions should not be a problem at all.

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