Most real estate contracts used in the Upstate or Midlands of South Carolina provide for an automatic extension of some length of time when, through no fault of the parties, the contract closing date cannot be met. In July of 2015, I wrote this post discussing the 5 day extension: https://www.blaircato.com/the-financing-contingencys-5-day-rule-in-the-ccra-contract/. Today’s post will examine the extension provision once more, focusing on how it relates to cash closings.
The Central Carolina REALTOR Association (CCRA) contract, which is primarily used in the Midlands, provides the buyer with a five business day extension if the buyer has provided a written loan commitment without additional conditions to the Seller prior to the contract close date. The time frame to close is thereby extended by five business days from the date originally agreed upon as the closing date. The seller may not refuse this extension, provided the buyer has provided the loan commitment.
Under the South Carolina REALTOR Association (SCRs) contract, which is used in the Upstate, the parties negotiate at contract signing the length of the automatic extension, if any. Contrary to the CCRA contract, there is not automatic five day extension, as the parties can negotiate any length of time including no extension. However, the buyer may only claim the extension if there is an unsatisfied contingency through no fault of their own.
But what if the transaction is cash? Does either contract address if and how an extension can occur in a cash closing?
Under paragraph 4 of the SCR contract there is no distinction in the contract close extension between cash and loan closings. Therefore, whatever term is negotiated applies to both cash and loan closings. No additional steps are required of a cash buyer.
Under paragraph 7(b) of the CCRA contract the closing date can be extended for five business days if the buyer has met the terms and conditions of Paragraph 6(D) but has not closed by the stipulated time. Paragraph 6(D) requires the buyer to provide the seller or seller’s broker, within five business days of acceptance of the contract, written verification of availability of funds from the source of those funds. Therefore, in a cash transaction the buyer can exercise the five business day extension provided the buyer has timely provided proof of funds. Seller approval of the extension is not required as it is a matter of right under the contract.
SAVE THE DATE: BLAIR CATO’S ANNUAL MILITARY APPRECIATION EVENT FOR REAL ESTATE AGENTS WILL BE HELD ON WEDNESDAY, SEPTEMBER 19, 2018. ONCE AGAIN THE EVENT WILL RAISE MONEY FOR THE SOUTH CAROLINA MILITARY FAMILY CARE ASSOCIATION. WITH YOUR HELP WE HAVE RAISED NEARLY $50,000 FOR SOUTH CAROLINA SERVICE MEMBERS FACING FINANCIAL CRISIS. THE EVENT WILL BE HELD IN OUR PARKING LOT AT 700 HUGER STREET. MORE INFORMATION TO COME. PLEASE MARK YOUR CALENDAR.
