IMPORTANT NEWS FOR SHORT SALE INVESTORS

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This is an email I received from one of our title companies:

“Per new underwriting guidelines from Attorneys Fund of Florida, Lawyers/Commonwealth/LandAm/Fidelity National, First American Title, Stewart Title, KEL Title, Alliant National Title, closings pursuant to Option Contracts are no longer insurable.

What this means…..we will no longer be allowed to close a transaction (insure the buyers or the lenders) that are being closed under an Option Contract between any party to the transaction.

Furthermore; ALL transactions pending under an Option Contract needs be converted to a standard real estate contract with a short sale addendum attached between the buyers and the sellers involved in the transaction.”

Just figured we would pass it along. Do your due diligence, and be sure you are not spinning your wheels on deals…

~Mr. 3 Days~

Categories : Mr3Days Video Blog

3 Comments

2

So what your saying is we need to go back and use the Standard Sales Purchase Contract. If we have a deal pending with the lender using an Option Contract we need to convert this to a sale contract with an addendum..does this conversion go to the lender or to the closing agent. If your using an Option contract and have to counter I would think you could counter with the Sales Contract so your no longer dealing with the lender with the Option contract. I’ve had no problems with the Option. Seems to many people are jumping all over.

I think it’s time for the GURUS to have a meeting so there all on the same page with their teachings as well as being consistant. You have one GURU saying stay with Options and you have others saying you need to switch. This is why I think they need to meet to be consistant with what’s being taught. We are only going to follow what we are informed about and often it could be we are being mis lead by the blind themselves.

3

Steve, the main issue with the Option is not with the lender, but rather the fact you can not get title insurance through most underwriters when closing at the title company. We are trying to be pro-active rather than re-active. Also, I do believe any outstanding contracts should be converted if possible to avoid any issues at closing.

I hope this helps!

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