Is the Buyer in Default?

1 Reply

I'll preface this buy stating this is the worst closing (closing attorney) I've ever had the pleasure of working with. I've bought and sold many properties over the years. Usually what happens is the buyer goes to the bank for new money, the bank hires a closing company to facilitate the transaction. That's where all the magic happens. I've done a couple of closing FSBO where we each were represented by Atty's. Nothing adversarial and closings went on with out a hitch.

I currently have a P&S on a building located in NH with a buyer from MA. The contract was executed on 1/31/21 with a closing date of 3/19/21. On 02/14/21 the buyers asked for an extension and extended the financing contingency to 03/22/21. They said they could not schedule appraisal in time. Well the appraisal happened and my agent requested an amendment to move the closing back to 03/26/21. We're all in agreement at this point.

I made an agreement with my neighbor to create a 25 year driveway lease that widens the driveway 4' so I can get a plow truck down there. The closing atty. found a couple small errors on the lease but would not disclose what they were. He insisted I hire my own lawyer and that he would confer with him. I refused and the insults and disparagement began. After several attempts to communicate with him I finally found that the wife's name should have been on the lease and there was a typo. (The atty. I hired to write the lease made the mistake. I had my atty. correct, I got it signed and have recorded it.

Now, 2 days before the closing on 3/26 this closing atty. tells me I need a specific "termination of lease". and he has declared the closing good until the 30th as one previous addendum mentioned. The termination of notice language is in the new Notice of lease. I don't believe you can just go back to an addendum that suits your needs. The current addendum says the 26.

I have asked for a commitment letter from the bank the closing atty. claims the buyer only needs to show Inability to provide financing. The way I read the P&S... If However: (b) BUYER fails to provide written financing commitment or evidence of inability to obtain financing by the financing deadline.

Personally, I don't care if I sell this building or not. It would be nice but not a necessity. I think the closing Atty is not qualified to complete the transaction. I know he had to contact a closing Co. here in NH and title Co. I assume that's why he wanted me to hire a lawyer for him.

At this point in the game I'd rather tell him to shove it than close. What I'd really like to do at this point is nothing. I have 30 days to fix any title problems maybe I take the 30 and let everyone cool down. What do you folks think?  Thanks and have a great day.

Hi Bill, I'm sorry you're not having a great experience.  MA has their own way of doing things, so I've seen some minor challenges with MA closing attorneys, but nothing that hasn't been easily rectified.

As to your question about buyer default, it certainly sounds like they could be out of contract; however, that greatly depends on the wording of the Purchase and Sales (I'm guessing your using an attorney provided contract) and the order in which addendums were signed.  Moreover, it can be common for title issues to result in an up to 30 day delay, for the Seller to rectify, in order to transfer clear title.  Your own attorney should be able to easily interpret the terms of your Purchase and Sales and advise you on the need to clear up any title issues.  I would certainly have your attorney reach out to the closing attorney directly.  It's always important to have someone in your corner to safeguard your interests.

And though it may be frustrating, it is important to keep the end goal in mind.  Even though you don't need to sell, you started the process for a reason, so keep that reason in mind as you continue forward.  Real estate transactions aren't all easy, this is just part of the process.