Money Issues After a Failed Sale – Know how escrow funds are handled if a deal falls through.

 

 

 

You miss 100 percent of the shots you never take, and if you think it’s expensive to hire a professional to do the job, wait until you hire an amateur. FOR OVER 20 YEARS, I HAVE WORKED EXTENSIVELY WITH OWNERS AND BUYERS IN LAND, COMMERCIAL AND INVESTMENT REAL ESTATE IN PHOENIX, TUCSON AND THROUGHOUT ARIZONA. PLEASE LET ME KNOW HOW I CAN HELP YOU. Call me if you want to sell your property and  need an estimated value.   Phone: 480-948-5554     Prefer cell: 520-975-5207 or email me walterunger@ccim.net.   

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May – June 2020  by Sebastian Jaramillo

In an ideal world, every transaction closes without a hitch. However, it’s important to prepare for those times when the sale does not close. In those cases, we are left with the question of how to deal with funds held in escrow.

Closing procedures vary by state. You need to be familiar with the process, whether you do business in an escrow or non-escrow state. The majority of states are non-escrow; in those states, the parties typically sign a purchase agreement and schedule a closing date. On closing day, the parties exchange all necessary documents and funds. In escrow states, like California and Arizona, the parties sign a purchase agreement (or escrow instructions), along with all pertinent documents; these documents are held in escrow until the date of closing.

Despite the differences, there are general principles involving default that apply nearly everywhere.

First, it’s important to confirm that your contract for the sale and purchase contains provisions regarding the duties of an escrow agent, if applicable. When the parties cannot come to an agreement as to the release of escrow, and they make conflicting demands for the funds, the escrow agent will generally not be able to release the funds to either party. An escrow agent (or broker) shouldn’t release funds unless both parties sign a release.

However, if you’re working with a seller who wants to make a claim on the escrow funds, promptly notify the escrow agent or broker to avoid inadvertent disbursement. It’s important that you communicate with your broker, the escrow agent, and the closing agent to let them know your objection to the release of an escrow deposit. Make sure you carefully follow the notice requirements of your contract.

When the parties cannot come to an agreement as to the release of escrow, and they make conflicting demands for the funds, the escrow agent will generally not be able to release the funds to either party. An escrow agent (or broker) shouldn’t release funds unless both parties sign a release.

Depending on your location, your contract may require that the parties attend mediation or arbitration before proceeding to litigation to determine entitlement to the escrow deposit. The actual remedy may vary if the escrow is being held by a broker, by a title company, or by an attorney. Assuming your contract doesn’t have a provision for mediation or arbitration—or that both steps have been completed—the escrow agent would typically file a lawsuit, known as an interpleader action, in order to be removed from the dispute. Funds are thereby deposited in the registry of a court. The amount of time that an escrow agent may be willing to wait to initiate a lawsuit will vary depending on each agent’s policies. It’s common practice for an escrow agent to hold the funds if the parties are making progress toward a resolution.

Occasionally, the deal may be disrupted at a point where the escrow agent is already holding the down payment and funds from the lender. Lenders normally require that a closing agent return the loan proceeds if the transaction doesn’t close. Likewise, the down payment tendered by the buyers is generally returned and not subject to the procedures and terms outlined in the purchase agreement for escrow funds.

When filing an interpleader action, an escrow agent is typically reimbursed from the funds in escrow for any attorney’s fees and costs incurred in the filing. This will inevitably diminish the amount of funds available to be distributed between the parties. That’s why purchase contracts—and common sense—dictate that buyers and sellers should try to come to an amicable settlement to avoid the cost and other challenges of litigation.

Sebastian Jaramillo, a partner at Miami-based boutique law firm Wolfe Pincavage LLC, leads the firm’s real estate practice group. A board-certified specialist in real estate law, he can be reached at sebastian@wolfepincavage.com.

SEE IT ALL:  https://magazine.realtor/law-and-ethics/law/article/2020/05/money-issues-after-a-failed-sale?AdobeAnalytics=ed_rid%3D3834981%26om_mid%3D2679%7CRealtorMagNews_2020_06_15%26om_nytpe%3DREALTOR%20MAG%20NEWS

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Phoenix Commercial Real Estate and Investment Real Estate: Investors and Owner / Users need to really know the market today before making a move in owner user Commercial Properties, Investment Properties and land in Phoenix / Maricopa County, Pinal County / Arizona, Properties and Investment Properties. I am marketing my listings on Costar, Loop-net CCIM,  CREXI.  I also sold  hundreds millions of dollars’ worth of  Investment Properties / Owner User Properties in Retail, Office Industrial, Multi-family and Land in Arizona and therefore I am working with  brokers, Investors and Developers. I am also a CCIM and through this origination ( www.ccim.com ) I have access to marketing not only in the United States, but also international as the market has a lot of moving parts today. What is going on socio-economically, what is going on demographically, what is going on with location, with competing businesses, with public policy in general — all of these things affect the quality of selling or purchasing your Commercial Properties, Commercial Investment Properties and Commercial and large tracts of Residential Land  Therefore, you need a broker, a CCIM (Certified Commercial Investment Member) who is a recognized expert in the commercial and investment real estate industry and who understands Commercial en.wikipedia.org/wiki/CCIM     FOR OVER 20 YEARS, I HAVE WORKED EXTENSIVELY WITH OWNERS AND BUYERS IN LAND, COMMERCIAL AND INVESTMENT REAL ESTATE IN PHOENIX, TUCSON AND THROUGHOUT ARIZONA. PLEASE LET ME KNOW HOW I CAN HELP YOU PLEASE CALL ME –  cell: 520-975-5207 or email me walterunger@ccim.net

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Walter Unger CCIM

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West USA Commercial Division

7077 E MARILYN RD.

Suite 200, Building 4.

Scottsdale AZ, 85254

Phone: 480-948-5554

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History of Arizona from  900 BC – 2017 -Timeline.

 

CLICK HERE:  Arizona Opportunity Zones As We Understand /maps. Interested!!! Please contact me.

History of Arizona from  900 BC – 2017 -Timeline.

WHY PHOENIX? AMAZING!!!  POPULATION – IN 1950 THERE WERE 331,700 PEOPLE LIVING IN PHOENIX – “NOW 5 MIL”. – “5TH. BIGGEST CITY IN USA”

PHOENIX TOPS US IN POPULATION GROWTH (MORE THAN LA, NYC) AND WHY THAT’S GOOD FOR THE ECONOMY, BUSINESS

 

8 Reasons You Should Invest in Land

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History of Arizona from  900 BC – 2017 -Timeline.

 

WHY PHOENIX? AMAZING!!!  POPULATION IN 1950 – 350 K PEOPLE; “NOW 5 MIL”. – “5TH. BIGGEST CITY IN USA”

PHOENIX TOPS US IN POPULATION GROWTH (MORE THAN LA, NYC) AND WHY THAT’S GOOD FOR THE ECONOMY, BUSINESS

DOT – LOOP 202 / SOUTH MOUNTAIN FREEWAY / PHOENIX AZ – UNDER CONSTRUCTION

ARIZONA FACTS – YEAR 1848 TO 2013

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What is a CCIM.

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  • DEMOGRAPHIC FACTS ABOUT MARICOPA COUNTY:
  • The average age of the population is 34 years old.
  • The health cost index score in this area is 102.1. (100 = national average)
  • Here are some of the distributions of commute times for the area: <15 min (22.7%), 15-29 min (36.8%), 30-44 min (25.1%), 45-59 min (8.6%), >60 min (6.8%).

LIST OF ECONOMIC DEVELOPMENT PROJECTS IN PINAL COUNTY, REVISED 2-14-17

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Why Phoenix?  This is a very interesting article, you should read it, amazing, there were only 350 K people living in Phoenix in 1950

Timeline of Phoenix, Arizona history

Phoenix, Arizona

Facts of Arizona – year 1848 to 2013

Feel free to contact Walter regarding any of these stories, the current market, distressed commercial real estate opportunities and needs, your property or your Investment Needs for Comercial Properties in Phoenix, Tucson, Arizona.

Walter Unger CCIM

Associate Broker

West USA Commercial Division

7077 E MARILYN RD.

Suite 200, Building 4.

Scottsdale AZ, 85254

Phone: 480-948-5554

Cell: 520-975-5207

walterunger@ccim.net

What is a CCIM.

 

FOR OVER 20 YEARS, I HAVE WORKED EXTENSIVELY WITH OWNERS AND BUYERS IN LAND, COMMERCIAL AND INVESTMENT REAL ESTATE IN PHOENIX, TUCSON AND THROUGHOUT ARIZONA. PLEASE LET ME KNOW HOW I CAN HELP YOU PLEASE CALL ME

 

  “You miss 100 percent of the shots you never take, and if you think it’s expensive to hire a professional to do the job, wait until you hire an amateur. FOR OVER 20 YEARS, I HAVE WORKED EXTENSIVELY WITH OWNERS AND BUYERS IN LAND, COMMERCIAL AND INVESTMENT REAL ESTATE IN PHOENIX, TUCSON AND THROUGHOUT ARIZONA. PLEASE LET ME KNOW HOW I CAN HELP YOU. Call me if you want to sell your property and  need an estimated value.   Phone: 480-948-5554     Prefer cell: 520-975-5207 or email me walterunger@ccim.net.       

 

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I am a successful Commercial / Investment Real Estate Broker in Arizona now for 20 years.  If you have any questions about Commercial / Investment Properties in Phoenix or Commercial /  Investment Properties in Arizona,  I will gladly sit down with you and share my expertise and my professional opinion with you. I am also in this to make money therefore it will be a win-win situation for all of us. 

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