Title Tip: Common Mistakes in Contracts That Can Get You Sued

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Let’s play a game I like to call “Don’t Get Sued.” We surveyed fewer than 100 escrow officers and asked them: “What is a common mistake you see on residential contracts?”

The top 8 answers are on the board. Ready with your buzzer? The survey says the 8 most common contract mistakes that could get you in trouble are:

1. Survey delivery issues.

Yes, the top issue in this survey relates to surveys. “I see Section C of the contract (regarding surveys) not completed correctly on a regular basis,” says Escrow Officer Sydna Holbert Pena of Excel Title Group. Most title officers agree that too often the first box of the survey paragraph is checked, meaning the seller will provide an existing survey. And then the seller either doesn’t have an existing survey or doesn’t provide it with the affidavit before the deadline. This can result in a seller paying for a new survey.

2. HOA document deadlines.

If there is an HOA, the contract calls for the seller to obtain, pay for and deliver HOA documents to the buyer within ___ days. Often the blank is filled in with a number that doesn’t allow enough time. “Keep in mind that HOA Resale turn times from management companies are BUSINESS Days, not contract days,” advises Avery Warren, Independence Title Manager and Escrow Officer. “If you have a 14 day timeline on your HOA addendum and you execute on a Friday night before Labor Day or long weekend, you are already putting your seller at risk.” Usually, the HOA management company will require 10 business days for processing and will not start processing the documents until the seller has paid the processing fee.

3. Buyer/Seller contact information missing/incorrect.

The exact and correct buyer and seller names should be on page one AND their contact information in paragraph 21 of the contract. “When it is put in the contract wrong, it is entered in our system wrong and the wrong person is searched (in the title search). That can cause issues down the road and possibly delay closing,” says Creighton Dippel, Escrow Assistant at Texas Premier Title. If the contact email and phone of the buyer or seller is missing or incorrect, the title company has no way to send them documents or communicate.

4. Lack of additional contact information.

Anyone who needs to receive information should be added to paragraph 21 of the contract. Warren recommends including real estate company coordinators. “The Transaction Coordinator should always be listed, because they need authorization to view and act on behalf of buyer or seller. So why not add them to the contract?” she suggests. “It’s always a guessing game for a title company on who uses who, and who we need to communicate with.” Additionally, the title company needs the buyer’s physical address and seller’s forwarding address. “If a buyer does not plan to reside in the property, the title company needs to know this for mailing of important documents after closing such as tax bills, HOA statements, warranty deed, title policy, etc.  Don’t just assume that we know that the buyer is buying this property as a rental, and will not live there,” says Warren.

5.  Addendums and Amendments not included.

“A common problem is agents sending over incomplete contracts. We are always asking for a Third Party Financing Addendum or Sale of Other Property Addendum, etc.” says Ally Macatee, Benchmark Title Escrow Officer. “They will select those options on the Addenda section (paragraph 22) but won’t send the forms”. Missing addendums and subsequent amendments are a frequent frustration for title agents and can affect the closing timeline and financials.

6. Blanks not filled in.

We’ve griped about this before.   https://candysdirt.com/2019/ 02/05/title-tip-the-blankety- blank-problem-with-your- contract/ . There is a valid reason for each paragraph and blank space on contracts. They should always be filled in completely. Don’t leave it to folks to guess.

7. Earnest Money not delivered on time.

“Not delivering the earnest money to the title company within 3 days after executing the contract can kill your deal before it really even starts,” says Robert Frye, Allegiance Title Escrow Officer. “If the other side has sellers’ remorse, not getting the earnest money to us on time can open the door to one of the few pathways for them to get out of the contract”.

8. Incorrect Survey Affidavit date.

The T-47 survey affidavit must be submitted with any existing survey provided to the title company. It contains a space for the owner to fill in the date of the existing survey. This date must match the date on the survey, not the date the property was purchased or the current date. The T-47 survey affidavit deadline is the same as the survey due date.

Thanks for playing and avoiding these contract blunders.

The opinions expressed are of the individual author for informational purposes only and not for legal advice. Contact an attorney for any particular issue or problem.


Lydia Blair (formerly Lydia Player) was a successful Realtor for 10 years before jumping to the title side of the business in 2015. Prior to selling real estate, she bought, remodeled and sold homes (before house flipping was an expression). She’s been through the real estate closing process countless times as either a buyer, a seller, a Realtor, and an Escrow Officer. As an Escrow Officer for Allegiance Title at Preston Center, she likes solving problems and cutting through red tape. The most fun part of her job is handing people keys or a check.

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Lydia Blair

Lydia Blair (formerly Lydia Player) was a successful Realtor for 10 years before jumping to the title side of the business in 2015. Prior to selling real estate, she bought, remodeled and sold homes (before house flipping was an expression). She’s been through the real estate closing process countless times as either a buyer, a seller, a Realtor, and an Escrow Officer. As an Escrow Officer for Allegiance Title at Preston Center, she likes solving problems and cutting through red tape. The most fun part of her job is handing people keys or a check.

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