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Can I buy/sell without escrow?

Discussion in 'Buying, Selling, Renting' started by Dozer95662, Jul 15, 2011.

  1. Dozer95662

    Dozer95662 TUG Member

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    If the seller and I trust each other, can we manage the transaction without an escrow company? Is it only a matter of the seller receiving the money, and completing some paperwork with the resort?

    Or is there esoteric paperwork that the escrow company handles which a "regular guy" would find hard to manage.

    I envision receiving the check, confirming funds are good, and making a couple calls/faxes to the resort and being done with it.

    What are the pitfalls (ie could I inadvertently forget to do a piece of paperwork and wind up in tax hot water with the county, etc?)
     
  2. rickandcindy23

    rickandcindy23 TUG Review Crew: Veteran TUG Member

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    I have sold several units for small amounts of money, all less than $800, and I told the buyer to send me their personal check, just as soon as they receive the deed. I also have the buyers take care of the transfer with the resort, so I am out of the loop, but I call the resort a few weeks later and make sure they know the transfer is completely finished.

    It has worked find. No one has flaked out and not paid me. This is all about trust. If you don't trust they will pay, then you can contact a title company and ask if they will hold escrow. I wouldn't pay even $100 for the service, but if my buyer insisted (why would they?), I would consider it their closing fee. I close all of the timeshares I sell. It's easy, and I feel better about doing it.
     
  3. DeniseM

    DeniseM Moderator

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    To transfer a timeshare between friends, or give away a free timeshares, you don't really need to pay for a full closing. I use this licensed Document Prep Co. that can prepare the deed and send it for recording for about $100. The owner (Alan) is a long-time TUG member - user name "ttt". They have an "A" rating in the TUG Business Ratings - Time Travel Traders/TSTransfer

    I know that owners can prepare and send their own deeds, but it's worth $100 to me to make sure it's done right the first time.
     
  4. Stefa

    Stefa TUG Member

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    I used this service when I sold my last TS for $250. We did not use escrow but agreed that the buyer would send the money as soon as the deed was sent for recording. Had I insisted on a full closing with escrow, I would likely have had to give the timeshare away.
     
  5. Talent312

    Talent312 Tug Review Crew: Rookie TUG Member

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    As a seller, your only real obligation is to deliver a good deed to the buyer when the $$ is tendered to you. Its actually their job to perfect their title by recording it and sending a copy to the resort with any transfer fees.

    You can prepare your own deed to sign. Just take the same one you got, only put your name(s) in the place where it says "grantor" and your buyer's name(s) or however they want it in the place where it says "grantee" and change the "return to" notation. Give them a copy to check for errors and say that, when you get the $$, they'll get the original, which they'll need to record and then send to the resort.

    But of course, using a doc-prep service does assure that its "done right." For my last small-time purchase, we used Legal Timeshare Transfers <readylegal@gmail.com> ($75). I sent the seller a cashiers check (his choice), they sent him a deed to sign, I paid their invoice (pay-pal), and the next I knew, we were good-to-go.
    --------------------
    Of course, before I sent the $$, I did an online search for his address thru the tax collector's office, looked to see if he had any unpaid liens, traffic tickets or a criminal history thru the clerk of court, verified his employment, and saw his house via Google Earth.
     
    Last edited: Jul 15, 2011
  6. BocaBum99

    BocaBum99 TUG Member

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    What is a licensed document prep co?

    What is the licensing agency? And, what type of license do they have? Are the real estate attorneys? From a legal perspective, it really matters.

    edited: I just checked out his site. From what he writes in his overview of services, he may be providing illegal deed preparation services. In many states, you must be an attorney to prepare deeds. Has anyone really checked this out? If so, no problem. If not, TUG is acting irresponsibly by not providing the appropriate caveat.
     
    Last edited: Jul 15, 2011
  7. BocaBum99

    BocaBum99 TUG Member

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    The answer to the OP is that, in general, you do not need to use an escrow service unless required by state law. However, it is foolish not to use one when it can be done for so cheaply ($100 or less). The reason for it is that there are very strict regulations on who can escrow money (usually attorneys, licensed real estate brokers and title agencies). Those restrictions and regulations protect you as a consumer against harm from either party.

    When a so called document prep company does not provide escrow, they don't because they do not qualify to open an escrow account. They have not been verified as someone to whom you can trust with holding your money.

    I think I have read somewhere that people compare these document prep companies to legal zoom. There is no comparison. Legal Zoom other sites which provide legal documents for sale provide generic documents which have been legally reviewed. You, as one of the parties in the transaction, can then take that document and modify it to meet your needs. That is legal.

    When someone takes a deed and modifies it on your behalf, I believe that is providing legal services which in most states is the unlawful practice of law.

    Buyer beware.
     
  8. doubleos

    doubleos TUG Member

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    I haven't found an Escrow company that will handle the Escrow for $100 or less, BocaBum99, do you have one that you would recommend?
     
  9. ronparise

    ronparise TUG Member

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    Thats the sellers half of the transaction....There is a second half...ie the buyers half

    The buyer wants to be sure that they receive a deed that means something, ie good title

    If you guys trust each other or if the dollars are so small and the property so worthless, that you dont care if the check bounces or the title is no good..go ahead without a third party to be sure
     
  10. BocaBum99

    BocaBum99 TUG Member

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    I do. Send me a pm and I'll let you know
     
  11. DeniseM

    DeniseM Moderator

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    Boca - Do you mean standard closing costs +$100 escrow fee?
     
  12. BocaBum99

    BocaBum99 TUG Member

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    No, I said escrow service. Holding money and then releasing funds based on a set of trigger events.

    If you want a full closing, then there is a lot more involved and more costs. There are some transaction that don't need more than escrow, though.
     
  13. Talent312

    Talent312 Tug Review Crew: Rookie TUG Member

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    An anecdote:
    A few months ago I bought a TS for $500 less transfer fees from a TUGger.
    -- I drafted+sent him a simple contract, he signed it, and I sent him a check.
    -- We agreed on a doc-prep service: Legal TS Transfers (readylegal@gmail.com).
    -- They did the deed, got it signed, recorded it and did the transfer. (I paid).

    The only vexing part was finding someone at the resort to confirm the transfer,
    but they did.
     
    Last edited: Aug 3, 2011
  14. Robert D

    Robert D Tug Review Crew: Rookie TUG Member

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    I sold a TS earlier this year for $2,500 and the buyer was comfortable with me drafting and recording the deed and doing the transfer. She sent me a check in advance and everything went smoothly and we got it done much faster than a licensed closing company would have. I prepared a sale contract that we both signed and then copied my existing deed verbatim with the buyer and seller names on it, had it recorded and then sent a copy to the management company to get it transferred into her name. Not saying I would have done this as a buyer but it saved her the $300 that a full closing would have cost.

    I've bought a couple low priced weeks (under $500) where I drafted the deed and did the recording and resort transfer without a closing company. On these, we had a signed sale agreement and I paid with a credit card using Paypal (and I paid the Paypal fee) to give me a little protection. Everything went fast and smooth.

    There is very little to closing a timeshare sale (calling it a closing is somewhat of an overstatement) and I'm surprised that someone hasn't set up a firm to handle closings for less than $250 plus recording fees for a simple transaction (some transactions can be complex and are well worth the $250).
     
  15. oldbuyer

    oldbuyer Guest

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    If you are familiar with the resort, have a Customer Service contact there then it's fairly easy to do a DIY sale and transfer. You need to draft a letter of Intent to Purchase with the facts and contact information. The buyer needs the ability to verify with the resort that the contract is paid in full and the current owner is current on the MF fees etc. I scan and email a copy of the face of the contract so they know we own it and they can then confirm the contract details with the resort.
    I then ask the buyer to sign a purchase agreement which they mail with a check for 50% of the selling price. I then sign and notarize the transfer portion of the contract (making a copy of it) and mail it to the buyer using the US Post office. (using the postal service gives the buyer and seller some protection due to mail fraud laws) The buyer then remits the balance of payment upon receipt of the signed, notarized contract. (if the funds aren't received in a timely manner I would contact the resort and try to stall the transfer process) The buyer is responsible to pay for and complete the resort transfer and I give them the contact information, fee costs and process information. After about a month I check to make sure the transfer has occurred by contacting the resort and reviewing my account information.

    I would not buy or sell any contract as a DIY if I did not personally know the resort I was buying or selling into or out of. In this case as I would use an escrow and/or closing company as required depending on the complexity, the other party and the dollar amount of the sale. I find the transfer and escrow fees usually exceed the value of the contract!

    Hope this helps. I'm not an attorney or escrow agent but have used this process several times without harm to either party.
     

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