My brother/sister are co-trustees of my mom’s living trust here in Calif.. She passed 5 mos. ago. They accepted an offer, conventional loan, 15% down, ‘As Is’, because they definitely DID NOT want any FHA repairs. Buyer’s agent had bank statements showing buyer had ,000. If they were going to put 15% down, ,500, my family agreed to pay their closing costs up to 3%.
The day escrow was to close our agent has them sign more documents. Later that day my brother realized that 2 of the documents were blank AND they referred to an FHA loan. I asked if he had a copy of the purchase agreement. The broker had given them a lot of documents but NOT the purchase agreement.
When my brother questioned the broker about it he said "What difference does it make" and has been condescending in trying to pressure him to allow escrow to close. We told him we didn’t want to pay their closing costs since they are going FHA. My brother got a copy of the purchase agreement 3 days before the close of escrow. My sister wanted to go through with the sale anyway [get the money!] but 4 out of the 7 siblings did not want to sell it to these buyers because we didn’t know what other changes that were made that could possibly make us liable down the line.
The broker, who is a notary and has been a realtor for over 30 years, said the blank documents were given to him by the lender and that the buyer and lender made the change to FHA and they did not tell him. He says "Net, Net, Net" you’re still going to get the same amount of money.
My brother stopped escrow because of this controversy.
Did we over analyze the situation? Is there a possibility of fraud {the broker chose the escrow/title}, breach, etc.
As co-trustee is my brother entitled to get a copy of all the escrow and broker documents so he can see what was going on? If so, how does he request it and what documents should he ask for?
Under what conditions/circumstances can escrow be canceled?