I would like to preface this with the statement that we all know no matter what field people work in, there are good ones and there are bad ones, whether it’s a contractor, an engineer, a Realtor, or a lawyer. Unfortunately it’s not always easy to tell which is which right off the bat.

Yesterday I was watching People’s Court on TV. There were two women, one who sold a house to another. Both women used attorneys vs. Realtors. When the woman who was buying the home did the usual walk-through a couple days before the close of escrow, it was quite aparant the woman who was selling the house was not leaving any time real soon. As should have been done, the lawyers provided for a seller rent back for 2 weeks to allow the seller more time to move. They also tacked on a heavy penalty to the seller if she didn’t move within the 2 weeks, which she didn’t.

They held the money for the 2 weeks rent in escrow, which was correct, but they didn’t have both buyer and seller sign a release of the funds with instructions for the money to either be released to the buyer on the date the 2 weeks were up, or to be pro-rated between buyer and seller according to how many days the seller stayed. That was the first mistake. The poor buyer went through weeks of calling escrow, trying to get a hold of the lawyers to release the money, etc.

The reason they ended up in small claims court is because the seller wouldn’t pay the penalty rent for the extra 10 days she stayed over and above the 2 weeks rent back. When the seller finally did leave, she left a ton of trash and all kinds of stuff in the property that the buyer had to pay to have removed. While this kind of thing can happen to anyone, the attorneys were both done with the transaction once the house closed escrow and the buyer couldn’t get either one of them to help her any longer. They ended up in small claims court.

Now, don’t get me wrong. This transaction could have gone this way even if they had used a Realtor. Many Realtors are in a hurry to collect that commission check and would have closed the deal also. Once you close escrow on a house, if the seller is still occupying the property, you have to go through regular legal channels to evict them just like you would any tenant that refuses to leave a property. What should have been done here to truly protect the buyer was to not close escrow until the seller was out of the property. At the very least it should have been explained to the buyer what all could happen if they close escrow while the seller was still in the property, and let the buyer decide what she wanted to do. In the meantime the buyer is paying on a mortgage to a house she can’t even occupy yet.

When I first got into real estate many moons ago, I was told “You wouldn’t want a Realtor defending you at a trial, and you don’t want a lawyer doing your real estate transactions.” Once you close escrow on a home, you have lost all leverage to have things come out the way they should. If things aren’t right when it’s time to close your transaction, don’t let anyone intimidate you into closing anyway. After it’s all said and done is not the time to get what was promised in the contract.