If someone wants to flip a home before taking possession, what should they know?
August 20, 2021
Brian Phillips
Legal Moment
Legal Moment on 980 CFPL
Transcript
| [phone ringing] | |
| Receptionist: | Cohen Highley |
| Announcer: | And now the Cohen Highley Legal Moment on 980 CFPL. |
| Announcer: | I’m with Brian Phillips from Cohen Highley Lawyers. If someone wants to flip a home before taking possession, what should they know? |
| Brian Phillips: | Our overheated real estate market has made it possible for buyers to enter into a new home construction contract with significant confidence that they can resell the contract to an alternate buyer before closing date for a profit. |
| Announcer: | And the risk? |
| Brian Phillips: | The original buyer is liable to the builder under the terms of the original contract. If the new buyer cannot close with the builder, the deposit could be lost and they could be liable for any damages suffered by the builder due to the default. |
| Announcer: | So your suggestion for would be flippers? |
| Brian Phillips: | Flippers must be prepared to close at the last minute if their flipee buyer cannot. This can be difficult unless the flipper is able to purchase for cash. Even if the builder resells for higher price, the flipper can lose the purchase deposit. |
| Announcer: | Thanks Brian. This has been the Cohen Highley Legal Moment. |
| [Music] | |
| Singers: | Cohen Highley, we’re listening. cohenhighley.com |
