100 Real Estate and Relocation Tips in 100 Days (Day 86)
Colorado is somewhat unique in that the standard contract to Buy and Sell Real Estate is date specific. Further, the contract, as with all forms used by real estate licenses in Colorado, are created and promulgated by the state real estate commission. Date specific means that all elements of the contract have a precise date of execution. In spite of great efforts to train and educate real estate licensees as to the importance of these dates with regard to a mutually beneficial conclusion to a contract, mistakes are made. As a consumer, it is important that you be aware of the dates and understand the logic concerning the flow of events, and be attentive to the dates involving important due diligence requirements. So here are the top ten contract date mistakes:
- Loan Condition Dates - this mistake takes a variety of forms, with the most common and unpleasant being the difficulty of the buyer recovering earnest money if the loan is not fully approved prior to this date.
- Appraisal Objection Deadline - With the new obligations imposed by the Home Values Code of Conduct (HVCC), just adding to the difficulties of properly completing and underwriting a timely appraisal, this deadline can wreck havoc on loan approval if not properly structured.
- Title Objection Deadline - it is not enough to receive a commitment to issue a title insurance policy, the buyer must understand the implications of the commitment and any covenant restrictions.
- Survey Objections - while buyers are well advised to obtain a survey, lenders many times require a survey after the dates have expired, leaving the buyer at risk if unexpected information if revealed.
- CIC Documents Deadline - Common Interest Community Documents, or HOA documents, must be understood and found acceptable by the buyer before this expiration date. Many of these documents are lengthy and complex, and need time to understand.
- Disclosure Deadlines - not enough time or too much time given is a common mistake.
- Inspection Resolution Dates - often found to be written with insufficient time to complete an acceptable resolution.
- Insurance Objection Deadline - too often this deadline is simply ignored by many consumers. There is never a guarantee of insurability.
- Closing Date - it is amazing how many times this date is written on a Sunday.
- Contract Acceptance Deadline - this date is simply being ignored by financial institutions selling foreclosed property.
Any and all of these dates can be and often are structured in an order that does not allow a logical flow to the contract, thereby placing the buyer at risk.