Best practices for extending the closing date in a residential deal on SCR310/300 forms can be read in this article.
Because parties sometimes desire to extend the closing date for a variety of reasons and because at the end of that extension when the closing still has not occurred, the parties often argue if the automatic extension of ___ business days for an unsatisfied contingency through no fault of either party, does apply or does not apply, this below article should help avoid this dispute without lawyers and court.
Buyers argue the extra time applies so they can get their loan done.
Sellers argue they are fed up with the postponement and certainly did not agree to an even longer extension with their property "off the market, aka pending category in MLS" and disagree with the buyers.
Judges interpret the parties intentions and the plain language of the agreement. Parties argue their intentions. Judge might read the plain language of the agreement in the buyer’s favor or the seller’s favor.
Therefore, SCR best practice recommendations to avoid court/lawyers to settle the dispute between buyers and sellers are:
1. Have all the buyers and sellers timely/properly execute a SCR390 addendum to the residential agreements (e.g. SCR310, SCR300) and type into the blanks of SCR390:
"Closing occurs when the Seller conveys Property to Buyer and occurs no later than 5 pm on or before ________________ [e.g. July 25, 2018, etc., date the parties agree upon] ("Closing Date") with an automatic extension of __________ [e.g. 5, 3, 1] business days for an unsatisfied contingency through no fault of either party."
or the old school method:
2. Make pen and ink changes to Section 4 of SCR310/300 to both the calendar closing date and the numerical fill in the blank of business days and have all the buyers and sellers initial and date these changes. Then, give them copies and give the lawyers involved copies too.
License law and the REALTOR® Code of Ethics require you to keep things in writing and forms updated.
Notice the extension in SCR310/300 is only for an unsatisfied contingency (e.g. financing contingency) and only if the contingency has not yet been met due to no fault of the party. So if a buyer did not pursue their loan in good faith, the seller’s lawyer might assert the extension does not cover the financing contingency because the buyer party was at fault for the delay.
SCR is hearing reports of REALTORS® who are untrained with forms and not putting offers into writing. This is a potential lawsuit for the real estate licensees and their brokerage as well as potential ethics violations for the real estate licensee and their BIC and potential license law violations for the real estate licensee and BIC.
To manage these risks, ensure that all licensees watch all the SCR forms training webinars/videos archived at screaltors.org and SC REALTORS® Youtube and attend all available forms classes and complete all available zipForms training online to help reduce these risks.
Posted by : Byron King on 6/22/18 (This information is only accurate as of 6/22/18. You must contact SCR for updates and changes to this information after 6/22/18 as laws and regulations may change over time. SCR 803-772-5206 or email info at screaltors.org)