What "and/or assigns" and a 45 day cash close should really signal to a seller

Say a seller lists a small rental at 172k, cash offer, no inspection contingency after day 10. Standard so far. Then the contract comes back with "and/or assigns" after the buyer's name and a 45 day close on a supposedly cash deal, which is a long window for someone who isn't waiting on a lender. A buyer who's upfront about it will say he intends to take title in an entity and may resell the same day to a builder. That disclosure is worth more than it looks, because it tells the seller exactly what to check in the contract rather than finding out at closing. Worth reading closely at that point: the earnest money amount and when it releases, whether proof of funds is attached or only a lender letter from a short term funder, whether anything in the contract requires the buyer to close with his own money, and how much of that 45 day window the seller has already told a downstream buyer they're liquid. The real question isn't whether the second closing failing becomes the seller's problem, it's structuring the contract so it doesn't. If the assignee's deal falls through, the funder's own commitment should determine whether they close directly rather than the seller finding out on day 44 that two more weeks are needed. Striking "and/or assigns" rarely fixes this by itself, it mostly just pushes a buyer toward taking title anyway while making the negotiation friendlier. The fix is in the closing mechanics and funding proof, not the assignment clause.

tylerbrooks9 AO1APRO 10

Answer

carlos_nunez AA4APRO 12

This is how it typically works from the transactional funder's side, not just reassurance. If the end buyer walks, the funder generally will not close, because that funder's payoff comes out of the second closing. Transactional money isn't there to help someone own a house for a month. So a failed B-C leg is very likely to become the seller's day-44 phone call. What actually protects the seller is timing and money, in that order. Shorten the close to 21 days if the buyer genuinely has cash lined up, and make the deposit nonrefundable earlier rather than later. Ask for the funder's letter plus a bank statement or escrow receipt from the end buyer, since the end buyer's ability to fund is the thing the whole close depends on and there's usually no window into it otherwise. Striking "and/or assigns" mostly changes which route the buyer uses and doesn't protect against the failure being worried about, though whether the clause matters more than that depends on state contract law, and a closing attorney can settle it in one reading. A larger deposit is the lever that actually does the work.

carlos_nunez AA4APRO 12

2 replies

tashaford30 SG2CPRO 16

The line worth focusing on is the seller telling their own replacement seller they're liquid. That's the actual exposure. If the 45 days slips, they're either unwinding their own purchase or funding it another way, and neither of those is priced into the 172k. Take 168k from someone closing in three weeks with their own money over 172k on a 45 day contingent chain. That holds even when every thousand is being counted carefully.

tashaford30 SG2CPRO 16

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