Wire Instructions, a Wet Basement, and a Municipal Lien
Closing is set for Friday at 10 a.m. On Thursday the buyer's agent receives an email that appears to be from the closing attorney, directing the buyer to wire $68,450 to a new account. The email domain is off by one letter. The agent forwards it to the buyer and the closing attorney's office without calling. At the final walk-through, the buyer finds a wet basement stain and a running sump pump; the seller's disclosure said 'no water intrusion.' The title commitment also shows a $4,200 municipal water lien. The settlement statement lists the Connecticut conveyance tax as a seller charge.
1. What should the agent have done with the wire email, and what are the licensee's obligations now?
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The agent should not have forwarded the email without independent verification. Wire instructions should be confirmed by phone using a number the agent already has-not a number in the email-and the buyer should be told orally not to wire until confirmed. If the buyer already sent funds, the agent should immediately tell the buyer to call the bank and the closing attorney, contact law enforcement, and preserve the email.
Under Connecticut license law and practice, the agent owes honesty and reasonable care, must not give legal advice, and should report suspected fraud. Forwarding a spoofed instruction can expose the agent to liability.
2. Can the buyer delay closing or require a repair credit because of the basement discovery?
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The final walk-through is generally to verify the property's condition, not a free cancellation right. The buyer can close only if the contract allows delay or if the seller agrees. The wet basement and the disclosure saying 'no water intrusion' may support a claim for misrepresentation or a request for a repair credit, price reduction, or escrow holdback.
The buyer should document the stain and pump with photos and a contractor's estimate, notify the seller and attorneys immediately, and let the attorney review the contract's remedies. The agent should not promise a credit the seller has not agreed to.
3. How should the municipal lien and conveyance tax be handled at settlement?
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The municipal water lien must be paid and released at closing so the buyer receives clear title; the title company should obtain a payoff and use seller proceeds. The conveyance tax is a seller's charge under Connecticut law, so the settlement statement is consistent.
The buyer should review the settlement statement and title commitment with the closing attorney before funding. The agent should coordinate but not disburse funds or give title or legal opinions.