House Closing Cancelled

We were almost finished signing papers on the closing for our next house when things fell apart. Because the survey revealed that the house was built on two lots—the property line dividing the lots running right through the house—our Realtor questioned whether the easements adjacent to the property lines might create problems for us should we decide at some point in the future to sell. A series of long, drawn-out conversations took place, both between Realtors and brokers and a representative of Cooper Communities, Inc. (CCI), the developer of Hot Springs Village. The CCI representative announced, after considerable discussion, that the existence of an easement between the two lots could “put a cloud on the title.” She suggested that the only way to remove the cloud was to go through a rather involved process involving utility providers, CCI, and the Hot Springs Village Property Owners Association. And, she said, there was no guarantee that the process would yield a clear title; even if it did, she said, the cost to address the easement issues would be $750 per property line. Fifteen hundred dollars, in other words; at least. The bottom line: we delayed the closing. The sellers will be responsible for addressing the issue and paying any costs associated with it. Assuming they resolve the matter, we will set another date for closing.

I feel much sympathy for the sellers. They have scheduled movers for December 7. They already have made at least two trips to the Carolinas, where they intend to move, taking trailer-loads of their belongings and putting them in storage. They have not yet bought a house, though they have tried. They are under enormous pressure to sell their house and move. But we cannot agree to take on the potential liability associated with a cloud on the title, especially if there is a possibility it cannot be resolved. The title company says title insurance does not cover such matters. And no one seems to take full responsibility for failing to uncover the matter until today, during the closing.

Fortunately, I have not yet taken steps to sell my house. This new development, though, will impact me in another way: my current house, too, sits on two lots, crossing two easements. So, before I sell, I will need to address the same issue (and the same expenses) with my current home.

The Realtor, in talking with the CCI representative, tried to get a sense of how long the process to “correct” the situation might take. She asked if two weeks was a reasonable timeframe. That would be “extremely optimistic,” came the reply. Someone else in the room mentioned that a similar situation had taken several months to resolve.

So, for the moment, everything is on hold for us. While it is upsetting to us, the situation must be absolutely maddening to the sellers of the house we are trying to buy. I wouldn’t want to be in their shoes. I feel such pity for them. And I feel a little guilt that we cannot do anything to ease their troubles. But it’s not our fault and there’s really nothing we could do to ease the burden on them short of putting ourselves at risk. So all I can do is hope they can quickly find a way to get through the process so we can move on to buy the house.

Time will tell.

About John Swinburn

"Love not what you are but what you may become."― Miguel de Cervantes
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3 Responses to House Closing Cancelled

  1. davidlegan says:

    If the sellers are really in a bind, they could escrow a substantial portion of the sale proceeds toward title expenses and/or remuneration to you. They get to move, you get the protection of enough money to feel safe. $10K, maybe?

    WTF are these houses built across property lines without a prior replat? Makes no sense at all.

  2. John says:

    Thanks, Becky. With luck, this hiccup will not take too long to resolve.

  3. Becky Hamilton says:

    Oh, John and Colleen. We’re so sorry to hear this.

Please talk to me about what I've written. I get lonely when I'm the only one saying anything.

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