14 May Indian Leased Land Escrows | Part 2 – You Need Extra Time
As you learned in Part 1 of our series on Indian Leased Land Escrows, when you’re dealing with Indian Leased Land, it’s just that: a lease. The person leasing the property is the Lessee. Most of the properties on Indian Leased Land are owned individually by tribal members who are considered to be the Lessors. The lease is managed by the Bureau of Indian Affairs (BIA) and the Lessors work with an Agent to formulate the lease. The lease pays for long-term legal use of the land for the duration of the lease contract.
It’s important to remember that additional procedures and processes may be required when selling or representing leasehold property. These procedures can extend the time needed for escrow.
You might need additional time if:
- The Lessor, or Agent for the Lessor, is out of town. Escrow is often at the mercy of the Lessor/Agents day to day schedule and/or other obligations. Executing the necessary documents that are required may not be a priority.
- Several Lessors use either Fey’s Canyon Financial or Joanne Allen & Associates to act as agents for their transactions. Each of these leases, and thereby the Agents who manage them, have many requirements, including reviewing and approving specific loan documentation, title report, contract, insurance, etc.. Fulfilling all of these additional requirements will add at least 3-5 days to your process, no matter how organized you are.
- If you are obtaining a loan, it may be more complicated than a non-lease land transaction. In a standard transaction, the loan itself is the most complicated part of the process. In an Indian Leased Land transaction, there may be loan restrictions imposed by the lease, which may dictate how much down payment is required, the length of the loan, and insurance liability requirements. Their protocol may or may not require signing additional documents which will then be returned for the Lessor to review and approve. Obviously, this can add days onto the process.
- The Buyer resides, or is presently located, outside of the country. In this instance, the timing can be delayed due to notary, going through the U.S. Consulates office, etc. Other issues may be present. What’s most important to know is that in this situation, even if it is an all cash deal, you won’t be able to have a rapid closing (5 days, for example) you won’t be able to within 5 days.
- If the property is in foreclosure and owned by a Bank, the Bureau of Indian Affairs has additional requirements that can delay the process.
In subsequent posts, we’ll address the specific items or situations – rather than simply the process itself – that add more time to your escrow transaction time.
For more information on the BIA, please click here.