ask george & chuck
March 12, 2007

Selling relatives' property, title company errors ...
Answers to real estate questions as appearing
in the Houston Chronicle

Dear George: My father passed away, and I am trying to sell his properties, which are in his name. How should I go about selling them?

Answer: Hire a probate attorney. This type of attorney can review your father's documents, guide you through the process, and represent your interests in court. Probate court is where you officially prove a will as being valid and deal with such other matters as liabilities subject to being settled from your father's estate and required public death announcements.

Dear George: What is the law in Texas regarding disclosure of terms and conditions of the contract when buying or selling a property? For instance, if a buyer and seller both agree they do not want the sales price or other terms disclosed or made public, can they keep it from being public knowledge? Assuming it is an all-cash deal, does the HUD-1 have to be of record?

Answer: If a buyer and seller of property in Texas wish to enter into a contractual non-disclosure agreement involving an all-cash transaction, they can. Buyers and sellers can pretty much enter into any legal contractual agreement to which they both agree.

Dear George: We sold a large tract of land four months ago, and now the buyer has determined that the title company made a $95,000 mistake in our favor. This also affects the REALTOR®'s commission and the title policy amount paid. The buyers demand that we pay the $95,000 without refiguring the total sales price and prorating it. This was a 1031 exchange, so we didn't get the money. It was paid to the qualified intermediary. We all signed the closing statement as being correct, not realizing there was an error made on the title company's part. What should we do?

Answer: It all depends on the mistake. Title companies make calculation errors all the time. They might receive bad pay-off information or bad tax rate information from a third-party source over which they have no control. Sometimes they also just mess up. That doesn't mean, though, that the responsible party can take advantage and profit from such an error. If, after a good faith investigation, there was an error and a party got the benefit of it, that party should pay what is owed and move on. Additionally, we suggest that you notify the qualified intermediary and notify them as to what the buyer alleges happened.