Anatomy of a Real Estate Transfer 2 Flashcards
Purchase Agreement (L):
Financing Conditions. Timeframe for buyer’s procurement of financing.
We need to know when the deadline- when is the closing supposed to happen. Is the closing going to fall through if we haven’t secured a lender or gotten financing by a certain date.
What part of the purchase agreement does this refer too?
Purchase Agreement (L): Financing Conditions. Timeframe for buyer’s procurement of financing.
Purchase Agreement (M):
Real Estate Taxes, transfer taxes, and closing costs. Who will pay?
___________ who is going to pay the real estate taxes, the transfer taxes, the closing costs how all of that is going to be handled.
Stipulate
Purchase Agreement (n):
Time is of the essence.
Time is of the essence.
Purchase Agreement (n)
Arguably the shortest but the most important provision of the whole thing.
Purchase Agreement (n): Time is of the essence
If time is of the essence is in the purchase agreement the seller has to
convey marketable title to the buyer by the closing date.
The seller has to do all the things that they are responsible for doing and hand them over by the closing date. It is really important to be very specific about when the_________ ________ is.
Closing date
You want to stipulate when the closing is and where it occurs. If the seller cannot convey the ________ __________ by the closing date the buyer can rescind and get the earnest money deposit back. That becomes the really big issue.
marketable title
If the seller cannot convey the marketable title by the closing date the buyer can _________ and get the __________ __________ _________ back.
rescind
earnest money deposit
Arguably the most important provision in the whole thing sounds super basic, super boiler plate choose your word. The buyer wants this to be in there.
Purchase Agreement (n): Time is of the essence
What does Time is of the Essence mean?
Time is of the essence means that the seller must convey the marketable title to the buyer at the closing date.
By the closing date. What happens if there is no time is of the essence provision? If there is no time of the essence, they have a
reasonable time pose-closing
Case coming up Conklin – case where somebody says they own it but there is no ________ _ _ _ _________ so a reasonable time post-closing included time for the lawsuit to go to court to prove that the seller owned the land by adverse possession and that could take a long time.
time is of the essence
Put time is of the essence in there because we want the seller to convey marketable title by the closing date. True or False
True
Purchase Agreement (o):
Inspections by buyer and permission for entry
Purchase Agreement (o): refers to what?
refers to all of the reasons you might need to re-renter the property after you initially view it.
sight visit and potentially to discover if there is an AP or to remove one.
Purchase Agreement (o):
refers to all of the reasons you might need to re-renter the property after you initially view it.
Inspections – home inspection – radon gas – sight visit to make sure nobody is there.
Purchase Agreement (o):
refers to all of the reasons you might need to re-renter the property after you initially view it.
Real estate professionals that need to go there: appraiser, surveyor, well and septic tests for rural property.
Purchase Agreement (o):
refers to all of the reasons you might need to re-renter the property after you initially view it.
Purchase Agreement (p):
Cleanliness of Property
Always do your walk through really close to the time of the closing because you want to make sure that there aren’t any issues. What does this refer to?
Cleanliness of Property
Purchase Agreement (q):
Survey
We want what type of survey?
Certified Boundary Survey
_____________ _________ ________ means that you have physical stakes / flags in the ground and if you tied a strong to each one you would be able to see the four corners of the land and know exactly where the boundaries are.
Certified Boundary Survey
You want it to be certified to make sure that the surveyor did a good job, you might assume well they were licensed, and I paid them. They mess up all of the time and when they screw up you can
sue them because when they certify that they have done a good job and that they are right, and they are wrong they have to compensate you for your loss.
If you were to look at your _________ survey that is not certified to you and if it is wrong, you cannot sue them you can only sue the person that is promising you.
seller’s
A typical buyer needs a _________ ___________ ____________.
Certified Boundary Survey
If you represent a real estate developer you want what type of survey?
Alta Survey
What is the best type of survey?
ALTA
Boundary line dispute and I have an ALTA I am going to win because it is the most ____________.
detailed.
Purchase Agreement (r):
Risk of Loss. Insurance Issues
In a majority of states, the risk of loss is on the buyer from the moment that they:
sign the purchase agreement.
In a _________ _____ ___________- the risk of loss is on the buyer from the moment that they sign the purchase agreement. That is weird because the seller is living there. We don’t all treat our stuff the same way.
majority of states
In a majority of jurisdictions, the risk of loss is on the buyer the moment that they sign the purchase agreement. Because of this the ________ should _________ _________. Insurance goes into effect at the _______ __________.
buyer
procure insurance
closing date
Purchase Agreement (s):
Warranties
Buying a house that has been previously constructed. A used house. A preexisting structure but it might have a brand-new roof or hot water heater and it might come with a ________. Find out if the __________ exist so you can have the roofers come repair at no cost to you.
Warranty
Warranties
Purchase Agreement (t):
Well and septic
Purchase agreement (u):
Appraisal
The _______ is for the benefit of the lender. The amount of the __________ seems to always come in the exact amount of the loan no matter how much the house is actually worth.
I bought some houses that I thought were a pretty good deal and were worth a whole lot more than what my loan amount was, but it amazingly always matches up.
Appraisal
Appraisal
Purchase Agreement (v):
Statement of Assessments (condos homeowner’s association fees, etc.)
It is important that you find out how much your condominium owner’s association fees are because that is going to impact the amount of money that you can afford to pay for your mortgage payment. Because sometimes those fees will be separate and apart from your HOA. – flowers and light at the front is what payment is for.
Florida – I Paid 2500 a year and I had swimming pool, tennis courts, volleyball courts, and a clubhouse paying more money in fees for amenities, but it impacts the monthly basis for the mortgage. Know fees to make sure you can afford to pay all of the things.
These refers to what part of the purchase agreement?
Purchase Agreement (v): Statement of Assessments
Purchase Agreement:
(w)
(x)
(y)
(w) Merger of Agreements.
(x) Plurals / Pronouns
(y) Invalidity of one provision does not equal invalidity of whole.
Purchase Agreement:
(w) Merger of Agreements.
(x) Plurals / Pronouns
(y) Invalidity of one provision does not equal invalidity of whole.
All three are standard boiler plate contract language.
YES
Purchase Agreement (z):
Signature block / legal document secure the advice of counsel before signing.
Representing a client that is a ________ _________ the signature block is exceptionally important.
corporate entity
It needs to be clear that the corporate entity is the buyer because that is who is going to have __________ ____________.
potential liability
_________:
Tiger Development Corporation
___: Magglio Ordonez
Magglio Ordonez
____: President
BUYER:
By:
Its:
In a signature block it is important to type out the full name and important to indicate in what ___________ they _________ in the _____________.
capacity
serve
corporation
The board of directors is a group of people, and they have different roles. not everybody has the same abilities on the board.
A document will stipulate who is supposed to do what and that is the __________.
bylaws
Regarding the signature block: In this organization the president and secretary are authorized to sign legal documents on behalf of the corporation, and they are both unavailable on the day of the closing. We find out in advance, and we fix that by doing it in house as a corporation with minimal guidance from our attorney. What do we use?
Corporate Resolution
__________ ___________: whereas tiger development corporation is borrowing 7M from bank whereas 7M will be used to construct 33 units of affordable housing whereas typically the secretary and president sign pursuant to the bylaws whereas they are unavailable at such and such date and time whereas at a duly called meeting with the board of directors where a corm was present and voting throughout now therefore let it be resolved that sally jones the treasurer can sign on behalf of the organization.
Tell the story of here is what we are trying to do they are not available here is the representative we are appointing to do it and we are authorizing them to sign the paper for us and the secretary will sign it and when the treasurer shows up at the closing nobody is freaked out.
Corporate Resolution
So, you have your signature block and you have finished talking about the purchase agreement, the buyer has gotten financing and they have convinced the lender that they are in a sufficient position to pay back the money, a_______ ___________ has been done, the bank is satisfied that the seller has good title, any defects are cured by the closing. One of the most valuable parts of this material is ______ ___________.
title analysis
due diligence
26 parts A-Z of a ___________ __________.
purchase agreement
Part 3 of The Anatomy of a Real Estate Transfer.
___________ secures financing (reviews __________ and conducts a _______ _________.
Buyer
appraisal
credit check
Part 4 of The Anatomy of a Real Estate Transfer.
________ _________ done. (bank must be satisfied, unsatisfactory ______ must be ______.
title analysis
defects
cured
