Events that May Require Special Attention
Below are some common “Red Flags” you may encounter with your clients. When these events occur, discuss them
escrow is being opened to address them; they may require special attention and take more time.
1
PROPeRTY iS BeiNg SOLD Due
TO DivORCe.
2
SeLLeRS(S) AND/OR BuYeR(S)
ARe uSiNg A POWeR OF
ATTORNeY.
you will need both spouses to sign all listing and escrow documents - are they
available and willing? Will they require two separate checks at close of escrow?
Do you have addresses for both of them?
Is it legal and binding? Is it less than 1 year old? Has it been recorded in the
county and state where the property is located? If not, you will need to obtain
the original to be recorded in your escrow transaction. The best thing to do is to
the Title Company for legal compliance.
3
SeLLeRS(S) AND/OR BuYeR(S)
HAve BeeN iNvOLveD iN A
BANKRuPTCY.
Is the bankruptcy still pending? If so, obtain the name and phone number of the
bankruptcy attorney. The property will need to be released from any pending
bankruptcy proceedings before escrow can close.
4
SeLLeR(S) HAve ReCeNTLY
mARRieD.
Will the new spouse join as a seller in this transaction or will that spouse need to
execute a quitclaim deed conveying his/her community property interest in the
property to the other spouse?
5
SeLLeR(S) Live iN CALiFORNiA
BuT ARe SeLLiNg A PROPeRTY
OTHeR THAN THeiR PRiNCiPAL
ReSiDeNCe.
CALFIRPTA tax laws require that any seller residing in California and selling
property (other than a personal residence) located in Califomia may also be
It will be necessary to establish the death of record for any seller who is deceased
and the proper documents for this can be prepared by your Escrow professional
with just a phone call. Is there a probate on the estate of the decedent? Was there
a family trust established prior to the death of the seller? If so. you will need to
know who the Successor Trustee is in order to obtain proper signatures. Many
6
ONe OR mORe OF THe SeLLeRS
ARe ReCeNTLY DeCeASeD.
7
THe SeLLeR ACquiReD TiTLe
WiTH A PReviOuS SPOuSe
FROm WHOm THeY ARe NOW
DivORCeD.
Due to the community property laws in California. you will need to be sure that
the previous spouse has deeded his/her interest to the spouse who retained the
property after the divorce. If no deed was ever prepared, then one will need to
be completed and signed by the previous spouse before Escrow can close. This is
another area where your Escrow professional can be of great assistance to you!
8
THe BuYeRS WANT TO HOLD
TiTLe iN THe NAme OF THeiR
TRuST.
You will want to be sure that the new lender will allow this type of vesting so be
sure to check this out as soon as possible.
9
NON-eNgLiSH SPeAKeRS.
Be sure that you can speak the language of your clients or that you have a very reliable
as well, to be sure that the proper person is available for your clients for sign-ups, etc.
YOuR SeLLeR OR BuYeR TeLLS
YOu THAT THe PROPeRTY iN
10
queSTiON iS PART OF A TAx
DeFeRReD exCHANge.
Who is the accommodator the clients are using? If he/she does not have one,
be sure that one is selected as soon a possible. Call your Escrow professional
to obtain more necessary information in order to see that all IRS regulations
are complied with your transaction.
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