Sometimes contracts cancel. The reasons are as varied as the properties themselves. A terminated contract often involves several folks being out money, time and other frustrations. Before you say ‘Hasta la vista, baby’ to your deal, consider what it might cost everyone involved.
Title Business
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Watching the ball drop on New Year’s Eve can be fun and exciting. But watching someone drop the ball on a real estate transaction is no fun at all.
What happens when the title company drops the ball and problems arise with your transaction? Get ready for a jaw-dropping surprise.
In Texas, the title company is not a party to the residential real estate contract. The buyers and sellers are the parties to the contract. While the title company is mentioned in the contract, their actions are made on behalf of the buyer or seller.
Let’s take a look at a few instances where the title company may drop the ball and examine the potential consequences.
Closing on a house can be frightful. But a new home is so delightful. And since we’re all set to go. Let it close, let it close, let it close.
While getting to the closing table isn’t always lively and fun, we still love to get there. There are a few potentially slippery steps from the time you put a warm signature on your sales contract to the handing over of the house keys.
Unless something pops up to put a freeze on the process, these are the basic steps most buyers and sellers will follow for closing on a residential property:
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When it comes to property surveys, sometimes age is just a number. Sometimes it isn’t. Many folks think a survey is good indefinitely. Others believe a new one is required with every sale.
Age isn’t the only factor in determining if an existing survey may be used for a real estate transaction. There are many details in a survey and a survey affidavit that typically outweigh the age of the survey. The confusion arises because there is no absolute rule for the age of the survey to still be useful.
I get all manners of odd surveys from sellers. Even if the survey is new, a blurry cellphone shot of it is not acceptable for use. Neither is a 1940s mimeograph copy. Hand drawing on a neighborhood map isn’t going to work. Cut off copies are no good either.
Ever wonder who owned your property 100 years ago? Or even 200 years ago? Your house probably wasn’t there yet and there may have been different trees, but someone else likely called your land home, just like you do. We need only to look to history to reveal the roots of your home’s DNA.
This one is for all the naïve buyers and sellers out there who think an escalation clause is a good idea. We’re not trying to shame you or say you’re wrong, but let’s just tell it like it is. It’s wrong for most residential contracts. That’s right, I said it.
An Escalation Clause is wording in a contract that states the potential buyer is willing to go above a certain amount. For example, a buyer may agree to pay $1,000 more than the next highest offer received by a seller.
An escalation clause is basically designed to strengthen a buyer’s offer in a multiple offer situation. In theory, it is fairly simple. The buyer offers a certain price for the property, but if the seller receives another offer that is higher, this buyer is willing to increase their offer up to a point. Escalation clauses are a tactic used by some buyers to make their offer more appealing and ensure the seller will choose their offer.
It might sound like a good idea for a buyer trying to win in a bidding war and an even better idea for the seller looking for the highest sales price. Sellers welcome buyers willing to pay more than anyone else. So why does the Texas Association of Realtors strongly discourage the use of escalation clauses? Why are they frowned upon by so many real estate industry leaders?
Let’s dive deeper. I’ll get my swimsuit.
