Re: Assigning contract - Posted by Stacy (AZ)
Posted by Stacy (AZ) on October 30, 1998 at 10:53:25:
My contract allows for 15 days for my inspection and approval of the property. This contingency allows me to cancel the contract by formally notifying the seller that I do not approve.
Further, my contract specifies a 30 day close, and limits damages of non-performance to only my earnest money, which is always $100. Additionally, I have a clause that allows me to show the property to inspectors, potential buyers, etc.
So, if I don’t find a buyer within 15 days, I could make a decision to either cancel the contract or continue another 15 days, risking my earnest money. But there are ethical dilemas involved (see below).
I have always found a buyer within the 15 days, normally a few days after my ad hits the paper. Competition is what keeps you safe from those waiting-out your contract. If you were an investor/rehabber and I came to you with a terrific deal, would you want to risk waiting when you know if you don’t want it, I’ll immediately shop it to many other buyer/investors who know a good deal when they see it?
Be careful, though. If you can’t find a buyer you should close on it yourself to avoid potential legal/ethical problems. There is still a chance the sellers could sue for specific performance, even though you have weasel clauses in your contract. Ethically, it’s wise to close on deals you make, if at all possible.
About the realtor’s sign…probably the best thing to do if you feel you must place a sign out front, is to be clear with them that in the case that your funding doesn’t come through, you will be selling to another party. I would opt for NOT placing a sign out front until I’ve quickly tried other methods, such as ads and calling rehabbers, etc.
Your title company should know how to handle a simultaneous close, if they do them. Some title companies don’t, so check ahead of time and find another who will if needed.