Cloud on a title. Not much is more aggravating than discovering some impediment to providing clear title to a property. The sellers often do not know about some issue in the long chain of ownership, and it must be rectified before a transaction can close. Having title work done at the time of listing can lead to the discovery of these issues before you get an antsy buyer on the hook.
Right of First Refusal. These things have a way of coming out of the woodwork when you least expect them. Sellers have often forgotten about granting this right or assume that the person will not want to redeem it when the time comes. Knowing ahead of time that there is in fact a right of first refusal and then who the parties are and what their terms of redemption are will keep you from running off a qualified buyer.
Underwriter pulls their loan commitment. Dang this is aggravating! You have already received approval for a loan, clearing that contingency, you have done the title search and inspections, and then one day this mysterious “undertaker” (underwriter) sends a “to whom it may concern” letter. I saw this happen last month on a large transaction. This makes you want to pull your hair out. The best thing you can do is have good relationships with quality lenders that specialize in land loans so that when an underwriter does pull this stunt, you have someone that can jump in and help.
Inspections reveal a major problem. Termite infestation, toxic mold, foundation trouble, sink holes, medical waste, high radon levels, leaky pond dam, asbestos, and the list can go on ad nauseum. There are many things that come to light during a professional inspection. By having these inspections done at the time of listing, you can identify and resolve potential problems. The worst time to address them is during the contract period.
Needing a contract extension. The lender needs more time. The closing attorney does not have the title work done in time. The surveyor could not complete the survey in time. Asking for an extension to a contract is one of my least favorite things to do in the world. It opens everything open for re-negotiation. People lose motivation or find another property they want more. Do not give people a chance to escape the contract if possible (if that is in the best interest of your client). It is the job of the land broker to keep everyone on task and to complete the transaction by the agreed upon closing date. Lenders and lawyers will often not see this closing deadline like we agents do, “the drop dead date.” I have one client that has asked me to add this phrase to his contracts, “Closing attorney will provide all closing documents to the purchaser no later than 72 hours before the scheduled closing.” This way when a closing attorney agrees to handle the closing, they acknowledge they will have the work done well ahead of closing.
