Mouse Trap was one of my favorite games growing up. Heck, I even loved it when Santa Claus brought one for my daughter a Christmas morning not so long ago. Much like the crank turns a gear that operates a lever that releases the boot to kick the bucket and drop the marble to start the trap moving, one person on a mission of perceived justice can unknowingly put into motion a set of circumstances that will delay, and might deny, well-qualified buyers and motivated sellers from completing the sale and transfer of ownership from one party to the other. Allow me to elucidate.
The guy who owns the land the HOA storage shed was sitting on is suing the HOA for back rent. It all started when the guy and the HOA discovered that the shed the HOA thought was on their property for all these years, was actually on the guys property. First, the guy tries to negotiate with the HOA to begin paying rent to keep the shed, which theyve been using to store maintenance equipment, on his property. The HOA declines his invitation, electing instead to remove the shed and store their equipment elsewhere, which sets the whole board in motion.
They guy then files a $25,000 law suit against the HOA for back rent for the time the shed was on his land and neither he nor the HOA knew. This creates a circumstance that the HOA now has to disclose to the buyers lender, when the question is posed is there any pending litigation against the HOA? The lender then asks to see the verification that the HOAs insurance company will cover the defense of the guys law suit. Which takes us to the insurance adjuster, who is the only person authorized to give the lender an official letter with specific verbiage sufficient to satisfy the lender that the, dare I say frivolous, law suit, will be defended under the coverage provided by the insurance company. And the insurance adjuster is not returning any phone calls. Not from the lenders representative. Not from the frustrated home seller, who very much wants to give the buyers the property for the agreed upon price and terms. Not from the sellers friend, who works for the same insurance agency as the one representing the HOA. Nada. Nyet. Nothing. And despite my inclination to walk directly into the insurance adjusters office and demand a response, she works somewhere in Texas.
Meanwhile, the buyers are frustrated that theyve now paid for a home inspection, an appraisal, and have also released a part of their deposit to pay for an HOA Certification (more on that later) which they agreed to do only based on an initial approval of a preliminary letter covering the defense of the law suit, which we all thought makes the litigation a moot point. Mousetrap.
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Email me. Leslie@LeslieEskildsen.com
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