A case where title refused an assignment three days from closing, and a per-state disclosure file saved the spread
Worth studying: a wholesale deal on a 1,450 square foot two story in an older working class neighborhood, contracted at 121,000 with an end buyer at 135,300, a 14,300 spread. The seller was an out of state heir who had been paying a property manager to do essentially nothing for two years. Everything ran by phone, text, and e-sign, with a local agent doing photos and a walkthrough video for a flat fee, which is often the only reason an out of area buyer bids without visiting in person. Three days before scheduled closing, the title company refused to handle an assignment of the contract on the file, citing no statute, just an underwriter's internal policy. Assignments routinely go through in some states and not in others, since escrow and title practice, along with the disclosure rules around assigning, differ state to state, and only an attorney licensed in that state can say what actually applies. What saves a deal in that position is having kept a per-state folder with a purchase agreement, an assignment addendum, and a plain disclosure to the seller that the buyer may assign or resell for a profit, all reviewed by local counsel before any offer went out in that market. Because the seller in this case had already signed a disclosure naming resale explicitly, the deal could be restructured to two closings the same day without renegotiating anything with him. That restructuring cost about 2,900 in extra title fees, recording, and transfer tax on the first leg, which came off the fee, netting 11,400 instead of the full 14,300. The piece worth keeping from a case like this is the disclosure signed at contract rather than at closing. The rescue only worked because the seller had already agreed in writing to something he was going to find out about anyway.
