Back to Back Closings can be Dangerous for Your Health

by Laura Days, Esq.

Back to back closings for buyers and sellers have great appeal.  You can sell your house in the morning, and buy the new one in the afternoon.  However, back to back closings are extremely stressful (for buyers, sellers, and their attorneys) and sometimes do not work as planned.   What happens if there is a delay in getting the funds wired from the bank?  What happens if the seller has not fully moved out?  How can last-minute title issues throw a wrench in the process?  What if you are the second back to back in a series of three transactions and the first one is late?

There are ways to avoid these potential pitfalls.  The best option, if you can afford it, is to buy your new house first, move, and then sell your old house.  But many of us can’t afford to do that.  So here are two other good options for avoiding a back to back closing:

The first is to sell your property, receive the proceeds, but stay in the house under a use and occupancy agreement for a few days until you are ready to go to the next transaction where you buy your new house.  This saves wear and tear on everyone, and you have a few days of lag time in case the first closing gets delayed for reasons beyond your control.  The cost of having a use and occupancy agreement drafted is small, and usually you have to pay “rent” equal to carrying charges to your new buyer (mortgage, property taxes, utilities).  It’s very simple to calculate.  There will be probably a “holdback” of a small portion of your funds to ensure that you will be out of the premises when you promised to be — even if you run into problems with your purchase.

The second option is to find a short term rental or a hotel and a good moving company with a storage option.  Many sellers find it relaxing to move into a hotel for a few days between their sale and their purchase, especially a hotel with a pool if you have kids, or one with a spa.  The moving company stores all your belongings until you are ready for the truck to come to your new house to unpack.  Rather than trying to do everything in one day, it spreads the process out and mitigates stress.

So if you’re thinking of a back-to-back transaction, rethink it as a delayed purchase with either a use and occupancy of your former residence or a mini-vacation at a nearby hotel.  It is very beneficial to your health, and also very protective for the transactions you are entering into.

Laura Days is an expert at helping clients buy and sell real estate, and works with the firm’s of counsel, Heather Hoffman, on making sure titles are clean and marketable in closings.

Tiger Woods – Throw that Prenuptial Agreement Away!

by Laurie Israel.   I’ve been hearing the sorry tale of Tiger Woods’ alleged deficits as a faithful husband to his beautiful Swedish wife, Elin Nordegren.  It is just a more publicized and extreme version of what I see in my law practice where I spend my days as a divorce lawyer.  In youthful marriages (Tiger is 33, Elin is 29, and have been married for 5 years), the pledge of fidelity is often a difficult one to maintain. 

According to Forbes Magazine, Tiger’s net worth from his work as a professional golfer is about a $600 million dollars.  (The $1 billion figure in the news is his lifetime earnings, not net worth.) 

Tiger actually fits the profile of having a good chance of having a marriage that lasted.  He met his wife four years before they were married.  Tiger’s parents remained married until his father’s death in 2006. When a child’s parents remain married, the child generally has a better chance of having a lifelong relationship.

 However, there were three strikes against him.  Tiger had become a very wealthy man at a very young age through his own efforts at his profession.  He has been a celebrity in the public light for a long time. These two factors alone can cause several personal and identity problems. And the third (probably the worst) problem is that Tiger (presumably advised by his attorneys) made sure that he entered into a Prenuptial Agreement with Elin prior to their marriage in 2004. This provided that Elin would get $20 million if she remained married to him for 10 years.

 Now, it appears that Tiger and his wife are compounding the error by renegotiating the Prenuptial Agreement, rather than just trashing it.

 Tiger’s first offer was to add another $5 million to the $20 million Elin would have received under the original terms of the Prenuptial Agreement.  Now, according to news reports, he is offering her another $80 million to remain with him another six years.  (Hmm, how much is that a year?)  Even $80 million for a man with $600 million is small change to buy Elin’s willingness to give Tiger another chance to recommit to his marriage.  So the message is, “You stay with me for another six years, and I will throw a little more money at you if we divorce.”  It doesn’t show very much commitment on Tiger’s part.

 The sad truth is that most fundamental problem in the Tiger Woods marriage may be that they had a Prenuptial Agreement in the first place.  It allowed Tiger to have one foot in the marriage and one foot out of the marriage.  It allowed Tiger (and Elin) to contemplate a divorce and the terms of the divorce even before they took their vows.  It allowed Elin (who was 24 years old at the time of the marriage) to make decisions with a huge impact about the financial implications of the institution of marriage before which she really knew what marriage was about.  It probably made Elin feel abused and probably made Tiger feel cruel and heartless.  Not a good way to begin a marriage.

 So when Tiger and Elin got married, they did not make the 100% commitment that most other married people make on their wedding day.  They had wedding vows, but if they said  “I marry you with this ring, with all that I have and all that I am, for better or worse, for richer or poorer … ” they were not telling the truth.  Tiger and his attorneys were manipulating the terms of a very real institution that has been developed throughout the thousands of years that humans have been creating supportive, monogamous relationships.  By manipulating it with a Prenuptial Agreement, they were weakening it, not strengthening it.  It’s not surprising that Tiger may have found it relatively easy to depart from his marital vows.  He had made another (contractual) vow that conflicted with the marital vows. 

 As a result, Tiger and Elin were only half married.  Marriage requires total commitment.  A Prenuptial Agreement gives a person a “way out” of the marriage.  Without that total commitment there are bound to be marital problems and divorce.  It’s not surprising that Tiger and Elin ran into problems. Couples that depend on each other financially do not have the latitude to think about straying from the marriage.  It is actually a blessing in a marriage not to have “too much” money.

 What if Elin said to Tiger, “Yes, I will stay married to you, but only if we rip up the Prenuptial Agreement and be like real married couples.”  Yes, they would have risk and uncertainly if there is divorce. Maybe that’s a good thing.  If Tiger finally said “Yes, I will be married to you, completely”, then Elin and Tiger could start to be truly committed to their marriage without money getting in the way.  They would both be following the marriage vows, and their marriage could truly restart. 

 So Elin and Tiger, think for a moment about tearing up that Prenuptial Agreement and starting a real marriage now.  Say to each other (finally) “I marry you with all that I have and all that I am.”