Too Good To Be True

Author(s): John H. Kuhl, Andrea Saunders Rifenbark

Source: The Institutional Real Estate Letter – North America

June 2008

John Kuhl and Andrea Saunders discuss protective measures for buyers in troubled times.

Executive Summary:

  • Before the Transaction, learn about the seller as much as possible. If the seller is insolvent or becomes insolvent, the bankruptcy courts can reverse the sale.
  • Buyers must clearly document that the transaction was made at arm’s length, for value and in good faith.
  • Obtaining a creditors’ rights endorsement to the title insurance policy will diminish potential pos-closing bankruptcy-related risks.