Can a homebuyer put a lien on a new construction because the contractor wants to sell the house to someone els

Question

Can a homebuyer put a lien on a new house against the contractor (he wants to sell it to someone else)? Homebuyer bought light fixtures, faucets etc. and paid for some suppossed upgrades plus interest on the bank. The house was appraised lower than what he was selling it for and he does not want to renegotiate.

Answer 1

I would think that you would have the house in escrow, so he can't sell, unless you terminate the escrow.

The lender will set the value of your property at the sale price or appraised value, whichever is lower, so a lower appraised price means you would have to come up with more money to close, if the Seller won't lower the purchase price to appraised value.

Hopefully, there was a contingency in your contract that said that in the event you couldn't close, for whatever reason, and he were to sell the property to another buyer, you would be reimbursed for the upgrades you paid for in advance.  It's not like the builder is out, he's being paid for them by the next buyer, who is getting the advantage of upgraded fixtures.  

If this isn't going to happen, and it was me, I'd be inclined to go gather my upgraded stuff.

Answer 2

You can not place a lien on the property unless you have won a lawsuit and have a judgment against him.  

The home appraisal does not have any meaning once you sign the purchase contract.  He is not obligated to renegotiate the price.

Usually there is a clause in the contract that says if you refuse to close the purchase when the house is ready he may sell the house to anybody.

You need to consult a lawyer but I don't think you have a case.

Answer 3

WHY OH WHY would anyone buy things for a house before they owned it?  Not very smart.. that's just asking for problems.  And no, I'm fairly sure you can't put 'liens' on the home.

If they originally thought the deal was good and signed papers to buy for a certain price, they ought to stick to it, even if the appraised value was less.

Answer 4

Sounds like your real question is... "How do I get reimbursed for the $$ I am out for prepaid fixtures and upgrades?" or "How do I get this builder to lower the home price down to appraised  value?" or "How do I get a higher appraisal than the current one?"

First off if all you want is the $$, go to the builder and see if he will either cut you a check (doubtful) or if he is willing to sign a promissory note or second lien on the house for the amount of the fixtures, etc. that will be paid to you upon the closing of the sale to a new owner.

Getting him to drop his purchase price may be hard, especially if he has any in house financing available to potential buyers.

Call the appraiser and explain the situation, maybe they can use better 'comps' than they used, or maybe they can value it a little higher due to upgraded fixtures, etc.

Good Luck!

Answer 5

If you have a contract aquire a attorney.If you defaulted on the agreed contract price,then you may not have any recourse as the things you purchased have become real property that belong to the contractor until close of escrow.