Transfer of Title...
Is a closing date...date of transfer...date of conveyance, what ever you might call it in your area, an important piece of the purchase agreement?
Last week I showed a house...a nice house everything my buyer client was looking for. This listing was showing active in MLS with a kick...meaning it had a 48 hour kick out clause. This is a fairly common contingency in our area which is used when a seller has accepted an offer from a buyer who must sell their present residence to buy.
The kick out clause allows the seller to continue to market their property while giving the buyer some additional time to sell. IF during that time frame another buyer comes along who does not have a home sale contingency the seller can entertain that offer and initiate a kick out clause. The clock is now ticking and Buyer # 1 has 48 hours to remove the home sale contingency, provide poof they can purchase without selling or their agreement becomes null and void.
Sound easy?...Well it can be and then sometimes it's a nightmare. Usually we have standard addendum's we use so that as agents we are not drafting legal documents. In NH it's illegal to practice Law and sell real estate without a license. So anyway all REALTORS have access to approved forms, contracts and addendum's that are available on line via our REALTOR state association. They're free and easy and we have a whole library full of every imaginable addendum an agent might find themselves needing. You simply click add the names, property address, print and your done...a very nice benefit if you ask me.
So just what am I getting at you might be thinking?
Well, I do the showing since the listing agent assures me that Buyers # 1 won't be able to perform without selling their current residence and my buyers do not have a home to sell...sounds pretty good...doesn't it?
My buyers love the place...of course!
We write up a very good offer with a close date 5 weeks out and contingent upon the seller initiating the 48 hour kick out and buyer # 1 signing the release. We'd technically be in second place only until Buyer # 1 signs the release. A formality the listing agent tells me as he is sure that buyer # 1 can not buy without selling and would not be able to afford a bridge loan in any case.
Okay, our offer gets accepted and all looks good. Nothing to do but wait for the release. We wait and finally get a call from the listing agent at what would have been the end of the 48 hour period.
Listing agent... "We have a... ummm problem..."
Me..."What kind of a problem?"
Listing agent..."The buyer's agent tells me the buyers won't sign a release."
Me..."Wow, can they get financing then?"
Listing agent..."Ummm I dunno."
Me..."Okay so what are you saying?"
Listing agent..."They won't sign."
Me..."So how long do we have to wait for their closing date to come and go?" I'm figuring it to be a few weeks out and my buyers, I knew, wanted it and would wait it out if need be.
Listing agent..."Well uhhh that's part of the problem...we don't have a closing date!"
Me..."What?? No closing date...How could that be? No closing date...no contract...not a valid contract in my opinion...BUT why would you have your seller sign a contact without an end/closing date? And what about the addendum...the kick out clause...gotta have a date on that?"
Listing agent..."Well ummm that's the other problem. It's a loosely written addendum written by the buyer agent and has no date."
Me ..."A Loosely written addendum...no closing date? How in the world could a professional let that slip by them?"
So guess what? No dates, anywhere and this contract was fully executed by all parties and now buyer # 1 won't sign a release...even though I know it's not a contract...I'm not an attorney... just a real estate agent who happens to know contract law.
Now these sellers will need to hire an attorney to help get them out of an invalid contract that they never should have signed to begin with. They are not happy sellers and the listing agent and his broker are both squirming. They are hoping that the seller just plays nice and gives buyer # 1 a little more time, they know if the seller hires an attorney that they will be the first one the attorney points a finger at.
This just really frustrates me! Unbelievable...
Monika McGillicuddy
Serving Southern New Hampshire and Rockingham County
Monika McGillicuddy Real Estate Training Website
Hampstead NH Real Estate
603-548-7728
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