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REAL ESTATE TRANSACTIONS ARTICLES

Documentation Releasing Seller Carryback

By Christopher Combs | June 18, 2019

Question: Ten years ago we purchased 40 acres of vacant land near Coolidge with seller carryback financing. In other words, we signed a promissory note to pay the seller monthly payments secured by a deed of trust on the 40 acres of vacant land. The final monthly payment to the seller is due next month. When I make this final monthly payment to the seller, what happens? Answer: Seller carryback financing is a mortgage from the seller, just like a mortgage from Bank of America or any other mortgage lender. After you make the final payment to the seller on…

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Can the Home Builder Keep my Earnest Money?

By Christopher Combs | June 10, 2019

Question: We entered into a contract to purchase a new home in a subdivision in the San Tan area for $300,000. We deposited $30,000 earnest money in escrow. After 45 days while the home was still in the framing stage, my wife decided that she wanted to quit her job and return to school. With only one income we will not be able to afford this new home now, and we want the return of our $30,000 earnest money. Due to strong demand in our subdivision, the homebuilder has just raised the base price for our model home, and the…

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Title Insurance is a Must-Buy

By Christopher Combs | May 3, 2019

Question: After my husband was out of work for almost six months last year, our credit was “shot to heck.” We cannot get a conventional mortgage loan so we are trying to buy a home in North Phoenix with seller carryback financing (i.e., the seller gives us a deed to the home and we make monthly mortgage payments to the seller). The seller says that in the twenty-five years that he has owned the home there have never been any title problems, and we should be able to save the cost of title insurance. Do we need title insurance? Answer:…

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Golf Course Lot or Not?

By Christopher Combs | April 22, 2019

Question:  At the time that we purchased our lot in the Tucson foothills, both the developer’s marketing brochure and the developer’s sales agent represented that our lot was a “golf course lot.” We have started construction of a new home on our lot. Last week we saw construction starting on the vacant land between our lot and the golf course fairway. When we contacted the developer’s sales agent he said that a golf course maintenance building will be built on this vacant land. We have now stopped construction of our new home because we don’t want to have a view…

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Can Buyer Back Out of Purchase Contract for Seller’s Breach?

By Christopher Combs | April 8, 2019

Question:  When we purchased our Chandler home, we received the Seller’s Property Disclosure Statement (“SPDS”). The SPDS did not disclose any prior flood damage or mold. During our 10-day inspection period, our home inspector that did not find any prior flood damage or mold. After the 10-day inspection period had expired, however, we learned from a casual conversation with a neighbor that both the seller’s home and the neighbor’s home had flood damage and mold remediation two years earlier. We now want to cancel the purchase contract and get a refund of our $10,000 earnest money. Can we get our…

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Realtor Forms Provide for General Warranty Deed from Seller

By Christopher Combs | April 1, 2019

Question:  In a recent column you discussed the differences between a special warranty deed and a general warranty deed. My understanding from your column is that in more than 90% of commercial/industrial sales, vacant lot sales, and new home sales in Arizona, the seller only furnishes the buyer with a special warranty deed. In resale home sales, however, the standard Arizona Association of Realtors Residential Resale Real Estate Purchase Contract (“AAR Resale Home Contract”) provides for a general warranty deed from the seller to the buyer. Why does this AAR Resale Home Contract provide for a general warranty deed and…

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No Commissions Owed Without Proper Documents

By Christopher Combs | February 27, 2019

Question: For several years I have owned a lot in the Wickenburg area that I inherited from my parents. I have been trying to sell this lot since last summer. One of my neighbors is a real estate broker, and he emailed me last week to ask if I would pay him a 5% commission if he found a buyer that would pay $300,000 for this lot. I emailed him back agreeing to his proposal. The next day this real estate broker emailed me a cash offer from a buyer for $300,000, with $25,000 earnest money. In the offer the…

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Dual Agency in Real Estate Transactions Presents a Problem

By Christopher Combs | February 4, 2019

Question: We listed our North Scottsdale home for sale with a long-time family friend because we trusted her.  A buyer has now signed a purchase contract for our home. This buyer, however, is represented by another real estate broker in the same brokerage firm as our listing agent.  Our listing agent says that she is sorry but she is now a dual agent who represents both us and the buyer.  Although we have signed the purchase contract and a form consenting to dual agency, we are not happy.  How can the same brokerage firm represent both us and the buyer, when…

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