About Real Estate: ‘Kick-out’ clause can protect sellers

A. I get this question often. It#146;s not unusual for buyers to make their purchase offers contingent on selling their own home first, in part because most need the sale proceeds to make a down payment on their next home.

You have a few options to protect yourself. Perhaps the best way is to accept their offer but make sure the agreement includes what agents often call a #147;kick-out#148; clause.

The clause would allow you to rescind your acceptance without penalty #8212; in other words, kick it out #8212; if a different buyer makes a better offer while you are still waiting for the first buyer#146;s home to sell.

An alternative would be to include a clause that states your acceptance is good for only a specified period of time, such as 60 days. If your buyers can#146;t sell their own home by then, your acceptance of their offer could then be voided and your home could be placed back up for sale.

Drafting either type of these clauses can be tricky, so you#146;ll need the help of a professional sales agent or real estate attorney to craft one that is legally effective. The agent or lawyer also may be able to suggest additional options.

Q. I have enjoyed your weekly column for a long time because it#146;s always so helpful and accurate, but I finally caught an error when you recently wrote about #147;riparian rights.#148; You said those rights give a property owner the legal authority to use a body of water on their land for irrigation or recreational purposes, but it actually involves the right for an owner to claim the sand, dirt or other soil that washes up on their property after a storm or flood. Finally gotcha, Dave!

A. No, you didn#146;t. You#146;re confusing riparian rights with accretion rights.

To explain the difference, let#146;s say that you are a farmer who has the riparian rights to use a local river that cuts through your property to irrigate your crops. If a flood comes and washes away half the sand on your riverbank onto my property downstream, my accretion rights will let me claim that earth as mine unless local laws say otherwise.

Thank you for reading my column so faithfully. It#146;s readers like you who help keep me on my toes.

Q. Are damages caused by a tornado covered by a homeowners insurance policy?

A. Yes, a standard homeowners policy covers damages caused by tornadoes, hurricanes and other winds.

My thoughts and prayers go out to the victims who have suffered from the deadly twister in Joplin, Mo., a few weeks ago and to those in other areas who have endured this near-record year of tornadoes. There have already been more than 1,000 twisters in more than two dozen states in 2011, according to the National Oceanic and Atmospheric Association, and the year isn#146;t even half over.

All but six states suffered at least one tornado in 2010, according to the NOAA, and 26 states were hit by more than 20.

Although most policies cover damages caused by high winds, it#146;s a good idea to call your insurance agent to make sure. Call your automobile insurer, too, to ensure that your car or truck is properly protected against destruction or damage caused by Mother Nature.

Also remember that the typical homeowners policy does not cover damages caused by the flooding that often follows a tornado or hurricane. Such protection must be arranged with a separate policy issued through the federally backed National Flood Insurance Program.

More information about the NFIP can be obtained by calling (800) 611-6122 or visiting its website, www.floodsmart.gov.

Ÿ For the booklet #147;Straight Talk About Living Trusts,#148; send $4 and a self-addressed, stamped envelope to David Myers/Trust, P.O. Box 2960, Culver City, CA 90231-2960.

$PHOTOCREDIT_ON$© 2011, Cowles Syndicate Inc.$PHOTOCREDIT_OFF$