All Forum Posts by: Tom Gimer

Wrong.

I confirmed this today with our SC counsel. 

PM me if interested. 

From elsewhere in the new law:

The advertising and marketing of real property is to be distinguished from the advertising and marketing of a contractual position in a sales agreement to purchase real estate. An advertisement that markets a contractual position to acquire real property from a person with either equitable or legal title and does not imply, suggest, or purport to sell, advertise, or market the underlying real property is permissible under this section.

People need to read closer.

OK then I will. The definition of wholesaling (a new term under SC brokerage laws) reads as follows:

"Wholesaling" means having a contractual interest in purchasing residential real estate from a property owner, then marketing the property for sale to a different buyer prior to taking legal ownership of the property. Advertising or marketing real estate owned by another individual or entity with the expectation of compensation falls under the definition of "broker" and requires licensure. "Wholesaling" does not refer to the assigning or offering to assign a contractual right to purchase residential real estate.

Since every word of a statute has to be given meaning, the last sentence is a clear carve out for investors who assign contracts and offer that interest to the end buyer. Sounds like more business is coming for local attorneys who understand the new law.

@John Underwood  I read what I believe to be the new SC legislation. Please provide the full new definition of “wholesaling” and reconcile the conclusion of your post with the last sentence in the definition.

Sounds like that's the law only if a OH real estate broker holds the earnest money... although many title companies follow the same policy, which is basically just CYA.

This is a great example of why REALTOR contract forms often suck. They are drafted in such a neutral way that parties have to go to court (or mediation) even when one party has no legal ground to stand on.

The contract language here essentially requires either (a) joint instructions, (b) court order, or (c) 2 years of inactivity with neither of the above occurring. 

Imagine agreeing to have a large EMD sit for 2 years in an interest-free account just because the other party is an a**hole and consider that everything is negotiable. Cross out language like this and replace it with negotiated terms such as automatic forfeitures and releases, penalties for failure to sign, loser pays attorneys fees, etc.

@Peter Walther Thanks for providing some of the law. Florida's scheme essentially "creates" privity between property owners and vendors through the required notices. 

But the question was how did the closing occur even with the "lien". The likely answer, if there is actually a lien filed, is that the lien was recorded in the gap. Perhaps title didn't do a bring-to-date before recording. Less likely is that title outright missed the lien.

I would not be particularly worried about a vendor threatening to lien the new owner. What's the point of that? Either there is already a lien or there isn't. That vendor couldn't possibly (uh oh -- I said it) satisfy the FL lien statute requirements at this point as concerns the new owner.

I assume one issue here is nobody is concerned enough about a $600 issue to prioritize it.

The methods of separating the owner from their funds grows... and the industry will continue to adapt. 

Now it seems transactional funders are in play. The uninformed will fall victim for sure.

Lenders of all types should require title insurance and also obtain Insured Closing Protection Letters -- the validity of which can be independently verified. Doing so would protect against everything described above.

Subs can’t record in most (if not all) jurisdictions. Subs have no contractual privity with the owner. 

Based upon the dates in the pattern, this “lien” probably fell in the “gap” between commitment date and closing date. Whether or not there is title insurance coverage will likely depend on whether or not there is coverage for the gap.

@Account Closed would send the actual personal information (privately), I'm sure there are some of us who could locate the sister, or at least her last known location and contact information.

Further, if the fact pattern supports it -- after all, the claim is that one sister was attorney-in-fact for the other -- the missing sister may not even be an essential party to the litigation.