Escrow contingencies removal can be frustrating for San Diego County Buyers and  sellers
 
There are many frustrating aspects associated with buying or selling a home in San Diego County today. One is that contract contingencies — such as inspections, financing, appraisals or the sale of another property — often aren’t removed on time. It’s not uncommon for closings to be delayed, usually due to the buyer’s lender or in the case of a short sale, the seller’s lender.  In today’s San Diego Real Estate market many buyer’s are making offers, getting acceptance and opening escrow on short sales and foreclosed properties.  These escrows have many factors that can cause delays that are not  controlled by the buyers and sellers.  The anticipation and planning for these escrow delaying factors is the responsibility of a fully experienced and professional Realtor.

Your purchase contract should include a provision to deal with deadlines that are not met on time. For example, in the home purchase contract used by many REALTORS® in San Diego and California, sellers can give buyers a 24-hour notice to perform. If the buyers don’t meet this deadline, the sellers can cancel the contract. This notice can’t be delivered earlier than 24 hours before the contingency is due.

You might want to issue a 24-hour notice, or some similar remedy included in your contract, if you’re in contract with buyers who don’t remove their inspection contingency on time and have made no effort to line up inspectors, especially if the buyers’ agent thinks her clients are flaky. If your contact doesn’t provide for a simple remedy for missed deadlines, consult with a knowledgeable real estate attorney.

In most cases where buyers can’t remove contingencies on time but they’re serious about moving forward, there’s just a glitch that needs to be addressed. A seller wouldn’t want to jeopardize the deal by invoking a demand to perform if there’s a good chance the delay is just that.

Recently buyers who were applying for a jumbo mortgage hit a roadblock when the house didn’t appraise for the purchase price. The loan and appraisal contingencies were due 14 days from acceptance — a near impossible time frame in the current lending environment.

The buyers were committed to buying the house, and the sellers were committed to selling to these buyers. The buyers requested an extension of time for the loan and appraisal contingencies; the sellers agreed.

HOUSE HUNTING TIP: At the first indication there could be a delay in a contingency removal or closing, your agent should let the other agent know so that it doesn’t come as a surprise. Your agent should be as specific as possible about the situation, without violating your privacy rights. The listing agent should cooperated with your agent and explain the complete situation.  If it turns out that there will be a delay, make a written request for an extension so that there is no question about whether or not the contract is intact.

Most San Diego County residential purchase contracts include a passive form of contingency removal. In this case, if the contingency is being removed, the party removing the contingency does not need to do so in writing. However, the preferred method for contingency removal is the active form where the party removing the contingency gives written notice that the contingency is lifted from the contract. This avoids any ambiguity as to whether or not a contingency has been satisfied.

Sometimes a contingency or closing is missed by a day. In this case, a written request for extension might not be made because the delay occurs at the last minute. For example, a final, unanticipated condition of loan approval required one buyer to prove that her Social Security number was, in fact, her Social Security number.

The buyer, a busy doctor, had to take off work and go to the local Social Security office to get the documentation the lender required. The loan contingency was removed a day late. But the escrow closed on time.

The closing and recording of the title for your San Diego County real estate transactions will require patience and flexibility.  These  are a necessary part of getting through today’s San Diego current home-sale transactions. Top professional Brokers and Realtors start working on removing and closing out contingencies from the very beginning of escrow to the proposed closing date.  However, if a delay is going to be more than one day, it should be agreed to in writing. Oral agreements are not binding.  A highly qualified and preferrably a licensed Transaction Coordinator will assit your Realtor  to handle the contingency removals.