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Name: ARDELL
Nickname: ARDELL
Member since: 2006-01-14 22:39:15
Website URL: http://www.realtown.com/ardell/blog
About me: An Associate Broker with Sound Realty. ARDELL was named one of the 25 most Influential Real Estate Bloggers in the U.S. for 2007 by Inman News, and has over 19 years exeperience in Real Estate up and down both Coasts. She represents buyers and sellers of real estate on both sides of the 520 Bridge from Kirkland, Bellevue and Redmond on the Eastside to Green Lake and surrounds on the Seattle side. You can reach her at 206-910-1000 or by hitting the email the author link above.

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Elusive Value: Title and Escrow

November 19th, 2009 at 4:39 pm

Craig,

Proof of timely delivery. No problem. The point that I am NOT missing is NO SELLER SIGNATURE should be required for buyer to get the return of Earnest Money on a timely inspection cancel.

Here’s my point, once you ask the seller for their signature, they often think their approval is needed and it is NOT. It sends a bad message to even ask.

Elusive Value: Title and Escrow

November 19th, 2009 at 10:51 am

Craig…off to an 11 o’clock meeting…I be back :)

Elusive Value: Title and Escrow

November 19th, 2009 at 10:19 am

Craig says: “The key is demonstrating to escrow that the notice was timely delivered.”

Agreed BUT proof of delivery vs. seller signature “agreeing” to “let” the buyer cancel and get their money back is all that is needed. If they want to cover their butts, they can choose to send that proof of delivery to the seller. What they CAN NOT do (but many do) to cover their butts is force the buyer to wait for the seller to agree to giving the buyer their Earnest Money back, when the choice is a unilateral one by contract.

Your “second” is wiped out by my first :) If escrow has any question about seller being notified, they certainly have the means to forward the proof of timely delivery before releasing the Earnest Money. They do not have the right to hold on to the buyer’s money to cover their own butts, causing the buyer unnecessary and undue harm.

Your third…no stink needed. Contract terms are clear. Hand the money back…end of story. No seller signature required. ONLY alternative is NO Earnest Money paid until after inspection, which USED TO BE an easier alternative. Who changed that? Someone who forgot to care about the buyer…as usual.

Elusive Value: Title and Escrow

November 19th, 2009 at 9:20 am

“what evidence does escrow have that the termination notice was timely given to the seller?”

Pretty simple. They send it to the seller when they receive it. Next?

“My prior comment envisioned the buyer terminating AFTER the buyer first proposed a repair…”

That is not generally the case that imposes a unilateral choice. Unilateral is most often where the buyer simply cancels on inspection, and under the current contract they do not have to attach a portion of the inspection report to show why. That leaves the seller who is asking why, with no contractual reason for the buyer to have to explain why.

I don’t necessarily agree with the way the form is worded in that regard, as it gives the buyer an open-ended legal out clause. But that’s how it is, and the contract does not require the seller to agree…and most sellers would not. They don’t have the information to form a decision. To require the seller to agree would have to go hand in hand with requiring the buyer to give a valid reason for the seller to consider and potentially refute.

Craig says: “Perhaps this is another difference between agents and lawyers. Escrow, take note: I’m far more understanding of your situation.”

I am more than happy to claim that difference, Craig. Getting my buyer client’s Earnest Money back PRONTO so they can make an offer on a different property is MUCH more important to me than being a “friend to escrow”. Escrow is NEVER my client, and I generally refuse to work with any escrow company that imposes a bilateral agreement to cover their own butts, when the purchases and sale contract allows for a unilateral one.

Out of town buyers do not have the time it might take to get the seller’s agreement of their decision to simply cancel and move on. This is hugely important to most buyer clients…the freedom to quickly switch to an offer on a different property without being unnecessarily tied up by waiting for a seller to agree. Seriously. Why would a seller make it easier for a buyer to leave and make an offer on a different property? That is WHY the contract does not impose that requirement, and no one should be able to insert their own requirement outside of the contracted terms.

In fact, I would expect an attorney who represents buyers to be outraged if their buyer client wanted to get their Earnest Money back to make a quick, new offer on a new property, and was told “no, we ‘want’ the seller’s agreement even though the contract between you and the seller does not require it.”

Elusive Value: Title and Escrow

November 18th, 2009 at 9:25 pm

Craig,

I do not believe the seller’s response in Section II is needed or relevant if the buyer is cancelling, only if the buyer is requesting something that needs the sellers response.

Elusive Value: Title and Escrow

November 16th, 2009 at 6:23 pm

I’m with you on this one, Jason. If the buyer has the UNILATERAL right to cancel based on inspection, escrow should not impose a condition whereby the seller must sign in order for the buyer to have their Earnest Money returned. That IS effectively “re-writing” the terms of the Purchase and Sale Agreement as you stated, and not their right to do.

Sellers never like it when buyers cancel on inspection, and the buyer should not need the seller to agree, in writing, in order to have their Earnest Money returned. (same with all unilateral rights to cancel).

Seattle: Characters Welcome...

November 13th, 2009 at 9:02 pm

It’s offensive…it’s separatism. That I find it offensive to anyone who is not a PNW “native” should be ’nuff said on the topic.

The Statutory Warranty Deed: What You Should Know as the Seller

November 13th, 2009 at 6:08 pm

Craig,

Very timely post. I just returned from a 3 hour meeting on the Title issues and exceptions on a newly built bank-owned property. Banks rarely if ever agree to “Statutory Warranty Deed”. Bargain and Sale Deed or Special Warranty Deeds are most common for property sold after being through the foreclosure process.

A buyer can’t insist on having a Statutory Warranty Deed and get the property. Your thoughts?

Seattle: Characters Welcome...

November 13th, 2009 at 6:04 pm

Great! Tell your wife to tell you to stop calling yourself “a native” in reference to me :)

Seattle: Characters Welcome...

November 13th, 2009 at 11:24 am

Hi Jerry,

I haven’t been on the East Coast since 1998 or so. I know there are some who think people who are not natives caused a lot of problems in the PNW. But it’s time to get over that and weigh the pros with the cons of the many who have moved to Seattle, and are still moving here. I love the fact that Seattle has wonderful and somewhat odd things like naked cyclists. I don’t think I’d feel differently about that if I were “a native” like you.

Seattle: Characters Welcome...

November 13th, 2009 at 9:44 am

Jerry,

I often wonder where they get the people for the Casino ads. They certainly don’t look like anyone I see out and about in Seattle. Though I don’t frequent Casinos, I did go once to see a friend of ours and his band. No one looked like the people in those commercials.

People crave real life every day observations, so a quick pic of a person going by is of value to many who read blogs. The event is on the City site…so I’m sure it’s at least a “notable”.

Seattle: Characters Welcome...

November 13th, 2009 at 9:40 am

LOL! I’ll ask him next time he walks by, but I’m pretty sure jumping into super cold water and being in The Polar Bear Club qualifies him as both quirky and interesting, without being patronizing. As does being a naked cycler in the Fremont Solstice Parade.

I find most Seattle blogs and sites show the Space Needle, and “Best of”, often very expensive housing that many can’t afford. I’m shooting for every day affordable realities in my two recent posts of Seattle Homes and people.

Seattle: Characters Welcome...

November 13th, 2009 at 9:20 am

Cynthia Pang Nowak at Zillow and I wanted to post pictures of quirky and interesting Seattle people. I chose the shirtless man of the Polar Bear Club. It’s her turn now.

Maybe the man in the photo is a “native”, maybe Cynthia is a “native”, I don’t know or care. I do know that it makes people feel uncomfortable when one refers to themselves as “a native” in conversation.

In my line of work it is dangerous to suggest there are natives who want “to keep it that way” vs. “outsiders or newcomers” who want to change things. It’s a common topic in real estate, and a fairly taboo one as well.

Seattle: Characters Welcome...

November 12th, 2009 at 11:01 pm

I don’t know why, Jerry, but I find it insulting to the majority of my clients when people use terms like “natives” vs. “transplants” and “newcomers”. Given the diversity of the Seattle area, it really isn’t appropriate to use such terms. Sounds exclusionary or classist.

Seattle: Characters Welcome...

November 12th, 2009 at 8:49 pm

Jerry,

I think writing about the things I love most about Seattle is VERY Rain City Guide :) You’ve been on Mercer Island too long.

The Fremont Solstice Parade, Polar Bear Plunge and many other “Seattle” points of interest are not outside of our area of interest. In fact The Tim complained I was talking too much about “issues” and not enough about “local interest” things…so I’ve been trying to infuse a few purely Seattle based posts. After all…we are “rain city” guide.

Seattle: Characters Welcome...

November 12th, 2009 at 2:20 pm

Rhonda,

The first day I saw him it was cold and raining and his upper body was bright red.

Condos - How much should be in reserves?

November 8th, 2009 at 12:03 pm

Hi Bill,

I’m not “an organization” :) Are the condos in the Seattle Area? I’d be happy to help with the thought process if it is in an area I am familiar with.

Investors, Tax Credit & 90 Day Seasoning.

November 6th, 2009 at 4:01 pm

Not really, Rhonda. A “flipper” doesn’t necessarily need to “do” anything to the property and it is merely a function of time that makes it “a flip”. (e.g. a quick flip)

One can buy at foreclosure for $120,000 and sell for $160,000 within a week and it would be a “flip”, but not have anything to do with “quality of improvements”.

Investors, Tax Credit & 90 Day Seasoning.

November 5th, 2009 at 7:18 pm

A “flip” to me is more about time vs. quality, unless you are saying quality by definition takes too much time to be a “flip”.

In a flip every day is a day of carrying costs, so time is of the essence.

Investors, Tax Credit & 90 Day Seasoning.

November 5th, 2009 at 7:16 pm

Jerry,

I don’t have anything to do with all of the changes…or there would not have been any :) You’ll have to ask whomever is in charge these days and if you can find out who that is…let me know.

Investors, Tax Credit & 90 Day Seasoning.

November 5th, 2009 at 4:49 pm

Jerry,

There are pros and cons to everything. I am thinking of two absolutely decrepit rat traps that someone bought, improved and sold. The neighbors were ecstatic.

Fannie Mae Announces Deed for Lease Program

November 5th, 2009 at 1:24 pm

The best way to do it would be for the “foreclosing” lender to be the equitable owner, but for the remaining in the home borrower to continue as the owner for maintenance issues. Perhaps the Deed in Lieu is signed to a future date which is the end of the “lease” period, and the mortgage payment is reduced to the fair market rent amount.

There are many ways to do this well, but there will also be many ways for it to fail if not done well or if the homeowner sees it as an opportunity to abuse the privelege vs. appreciate it.

Fannie Mae Announces Deed for Lease Program

November 5th, 2009 at 1:20 pm

“I’m guessing that the market area rent is going to be lower than the modified mortgage payment.”

For someone who bought zero down with stacked costs at peak, then tried to get a loan mod where they did a forebearance wrapped into the back end, the market rent would be significantly less than the newly modified loan payment. Possibly even half.

Fannie Mae Announces Deed for Lease Program

November 5th, 2009 at 11:06 am

Rhonda,

It doesn’t happen automatically because it would have to go through a similar process as the Agency Law Pamphlet, to become a requirement for agents. By the time that process is complete, the market phase may pass, and so it is deemed an unwarranted use of resources at government levels State to State. Often options vary from State to State, so it can’t be a Federally regulated disclosure like lead based paint. By they time local governments notice and decide to work on some problems…the problems are gone.

A highly ethical broker could hire an attorney to compile that list of optons, and require their agents to hand it out. But attorneys want the broker to say “consult an attorney”, and so when most don’t, the consumer is not adequately supplied with the correct info.

The distressed owner does get a list of options from their foreclosing lender along with tons of other scary papers, but then an agent knocks on the door and convinces them that short sale is the best and maybe only option.

Escrow Trenches: nutty funding conditions

November 5th, 2009 at 10:47 am

Craig,

While I agree that it is not a “kickback” I don’t agree with your why. Clearly if an agent received $50 for the buyer or seller choosing a home warranty, disclosure of that fact does not make it any less of a “kickback”. So disclosure and approval by all parties is not the reason it is not a kickback.

The reason it is not a “kickback” when the buyer’s cost is less than the seller offering, is because the buyer is every bit as much a party in interest to the transaction that the seller is. So a reduction in the buyer agent fee needs to find equal footing to reduction of the seller agent fee, but price reduction of that amount is likely the most responsible way of achieving that.

UNLESS the buyer is a cash buyer, the lender has every right to restrict cash backs and rebates as long as the money being exchanged is related to financed funds. Just because the lender is willing to allow financing of legitimate costs, does not mean they will allow $5,000 cash back or rebate to a buyer so that the Disney Family Vacation is financed in the home mortgage.