Contract terms. Interesting???
In December of 2005 I had a buyer in contract with a requirement for closing of December 24, 2005. He had a deposit of $118,500 on the table. All contingencies had been removed.
The date came and the date went. No big deal, said the buyer. We can close tomorrow. Tomorrow turned into T+1, then T+2.
The contract called for a written notice of default and then 3 business days to cure. I did my part, buyer did not do his.
We had a back up contract, subject to ultimate default, from buyer #2.
It was a slow market. It didn't matter.
Buyer did not close and lost $118,500.00.
Buyer # 2 closed at the same price as Buyer #1. Seller got contract price ++ $118,500.
Here is the point - - The little documents called "Purchase Agreements" need to be treated as DOCUMENTS WITH CONSEQUENSES.
It is very important that timelines be followed. You could burn $118,500. Maybe more.
Do you have questions about distressed assets, receivership or bankruptcy sales, auctions? Email me at rfk@gryphonusa.com and I'll try to answer it in an upcoming post.
Richard F. Kruse is the President of Columbus, Ohio based Gryphon USA, Ltd. (www.gryphonusa.com). The Gryphon Organization includes Gryphon Asset Management providing receivership and consulting services in the distressed marketplace, United Country Gryphon Realty & Auction Group (www.ucohiorealty.com & www.ucohioauctions.com) providing real estate brokerage and auction services throughout Ohio and OnlineAuctionUSA.com (www.onlineauctionusa.com) providing commercial asset liquidations from the Midwest to East Coast.
United Country Gryphon Realty & Auction Career Opportunities Available. Call 614-885-0020 x 17
rich,
loan me 20 bucks!
2% a week, interest only, 3 month balloon and it must be secured by real estate.
Too bad that this was not an auction, I would have been able to split the default with the seller.
i have seen some pretty weak contracts.
i cannot believe some people dont read more