LoveInTheHouse??? Did you close?

maddieleeOctober 18, 2011

I've been following your story.....any good news? I hope.


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Nope. The bank is still not ready! It's still in underwriting. My buyer said they requested another document--a statement or something from the buyer's bank showing the money trail. Why they didn't ask for this last week, I have no idea. Tomorrow I'm in violation of the contract on the house I'm supposed to buy and the seller is furious because I was in contract with them when I lost the last buyer. On top of that, the seller switched agents when his listing expired but since I was shown the place by his first agent, I'm her client. So his new agent wants this deal to fall through and is encouraging the seller to kick me to the curb. My buyer's agent is warning that if I don't give them a new closing date soon, I'm going to lose the house. On top of all the inconvenience--canceling truck, horse hauler, stopping work, etc. THEN my buyer is scheduled to go on a cruise this weekend which they had planned for a long time. So that's a problem too. It's a nightmare. It's not right what these banks do. And even worse, I really don't even know if they're going to get the mortgage period! But thanks for asking!

    Bookmark   October 18, 2011 at 11:54PM
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Sounds like your buyer might have had a large amount of funds deposited into his account just recently. It is normal for a bank to want to verify where they came from.
Cruise ships have fax machines, wireless email and cell coverage... no reason at all not to close.

    Bookmark   October 19, 2011 at 7:48AM
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LITH~~ I was wondering about you also...but hoping for
much better news.

We had an "encouraging" showing yesterday, but hearing things like this scares me even if it would sell...I don't think I could stand all of the stressful things you have had to endure.

Sometimes I wonder if you (we) are suppposed to sell or just stay put.......but both of us long to be "back home". May God put us where He wants us to be~~

I do hope things work out for you SOON...and as ncrealestateguy said, there are fax machines, etc. on a cruise ship, so don't let them use that for an excuse.


    Bookmark   October 19, 2011 at 11:55AM
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I know you said your sellers in NJ were getting antsy, however look at it from their perspective but with your own experience as a seller as a guide. You were willing to be very flexible about the efforts on the part of the would-be buyer who had flood zone issues with his buyer. You hung in there to try and salvage the deal, IIRC, and I think they will, too.

Since you have clearly demonstrated your determination to sell, (and sell and sell and sell ....!) it's not like one of those circumstances where a would-be buyer hasn't gotten around to actually getting their house on the market, yet, and still wants sellers to wait.

I have no idea how long it takes to go "through underwriting", but it can't be too much longer, so you should know any day now.

You absolutely should demand that your buyers do everything to close immediately, no matter where they are. They can wire the funds and get an attorney to do their closing stuff. (Tough luck if that adds a bit to their closing costs!) And since you have a hold-over arrangement, it's not like they were planning to move in right after the closing. When I did my last FSBO in VA, none of us were in VA, neither my sister or I nor either of the two buyers. It was all handled by lawyers.

Are you getting any sense from the buyers that they know they are in default and may lose the deal if they don't force the issue with their bank? This is their problem, not yours. Maybe some letter from your lawyer to theirs saying the magic words "time is of the essence". If Bob has already quit his old job, doesn't he have housing problems if he is still livng in the old place?

The needed letter from about the origin of the funds is the only hold-up I can see. The bank is looking at that because they don't want to risk that the newly-arrived funds are actually proceeds of an undeclared loan which would change the overall debt-to-income ratio calculations. When we bought this farm, my MIL gave us a gift towards the DP, and that created an "issue" at the last minute as the funds arrived in our account the week before settlement. All we needed was a written statement from her that it was a outright gift, not a loan.

I hope it gives you encouragement to think of all the people, really strangers all, who are reading your saga here and pulling for it to work out for you.

I'm going to go down to cellar with a big machinst's hammer and my largest wrench and make some slight adjustments on the settings of my mojo-machine. In circs like this, it's important to have it perfectly calibrated in order to get LITH to NJ, ASAP. Please excuse any clanking and cursing you may detect while I'm down there. It's all in a good cause.


    Bookmark   October 19, 2011 at 4:58PM
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Aw, thanks Liriodendron! Yes, it really helps being able to vent to you guys and I know you're pulling for me. And beating on some pipes for me!

Well, let's see. There's another problem. The buyer got the statement the bank needed so that's taken care of. But now the underwriters discovered the buyer's ex-wife, who he is still legally married to, is late on an income tax payment. I don't know how much it is. I don't know if it's a small amount that's no big deal or a large amount. I don't know if it would make a difference if the ex-wife provides a letter stating it's her debt. I don't know if it will make a difference if the buyer pays it himself, if he can--maybe it's ruined his credit rating? The buyer feels it can be resolved but he is not sure how the bank will want him to resolve it. He was at work all day and plans to speak to the loan officer asap. He gave me permission to call the loan officer tomorrow and speak to her myself. I really need to find out whether it's resolvable or not. Is it just a delay or does this mean he won't get the mortgage? I have to tell the people up north. Yes, you're right L, I was willing to be flexible with my last buyer and hopefully they will be with me, because yes, I keep selling! I am doing everything I can! But according to the selling agent of the house up north, they got another offer. It's a cash offer with no contingencies. The seller is taking it as a back-up offer. I think it's either a bluff or it's a lot less than my offer, otherwise he'd take it now because I am technically in violation of contract today. At any rate, if I could just give them a new closing date, I think they'd wait for me.

The buyer and I are sharing a lawyer. He's been communicating with me and seems concerned and upset, though he's still going on the cruise. (Thanks NC. Good to know there are fax machines, etc. on these cruise ships.) Yes, he quit his old job and is now at his new job near my house. They are in a family rental but new renters are supposed to move in on Nov. 15 so even though their situation is not quite as bad as mine, it's bad.

Phoggie, I do think about that! But I don't know why God would want me to stay here! It's a beautiful place but I need my family. I'll tell you the lesson I think I'm supposed to learn. I think I'm supposed to learn patience. And also that I cannot control everything. I have a feeling that this is not going to go through until I finally give up. I told my husband that we're not going to close until he cuts wood!

    Bookmark   October 19, 2011 at 10:22PM
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But now the underwriters discovered the buyer's ex-wife, who he is still legally married to

I would call her an estranged wife, not an ex-wife then.

    Bookmark   October 19, 2011 at 11:07PM
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And hopefully the "ex"-wife and buyer have a clear separation agreement that unequivocably, and permanently, separates them financially. Otherwise that's a BIG problem, especially if VA is a community property state. (She might later be able to assert a marital claim to the property, but have no enforceable obligation to service the debt, for instance.) Didn't the buyer have to fill out paperwork about that sort of thing during the mortgage app. stage?

Hoping you get good info from the bank tomorrow. I agree that the back-up offer probably is much lower than yours, otherwise the NJ seller would have expedited a "You're in Default and We're Otta Here" letter about 10 secs. after midnight yesterday. So you remain the better, more attractive bird in the hand, and still technically a cash offer, as well. Just no cash until Bob sorts out his messy affairs. I think he should have to stay and dance attendance on the bank's minions until they are satisfied, while you go in his stead on the cruise. You've earned a vac. with fruity drinks with paper umbrellas in them and lots of pool-boys with great tans.


    Bookmark   October 20, 2011 at 2:43AM
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Liriodendron, the buyer DID have to do some things regarding the ex-wife before he started the whole process. "Bob" actually appeared when I was still in contract with the last buyer and that deal looked like it was going to fall apart. Bob told me he wanted my house but spoke to the bank and/or lawyer and they told him what he had to do to to be able to go forward. They advised him to remove his name from the house that he owned with the ex-wife. I don't know the details, whether he just signed it over to her or bought her out or what. He said it would take some time. I said, "Well, for your sake I hope my house is available when you get that taken care of, but for my sake, I hope it's not!" We laughed. They also told him that the ex-wife would not have a claim to this place. He came back to me when he did what they'd told him to do and by that time I had lost the other buyer. So Bob and I went forward.

    Bookmark   October 20, 2011 at 6:52AM
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Glad Bob has been doing what's necessary to extricate himself financially out from his wife. One question that your answer immediately raised in my mind was whether or not he assigned his interest in the house to her, if the property had a mortgage he would still need to get that lender to formally release him from that obligation, as well. You can owe money on property you no longer have an interest in. Banks aren't usually thrilled by people who owe debts like that since there is a high default rate on them. Nor are they eager to release anyone who might conceivably be on the hook to service the debt, especially if it was initiated based on two incomes, now reduced to one. In a proper sense, the estranged wife would need to reapply for a one-income mortgage, and get it, in order for that bank to release Bob.

I truly hope this isn't necessary, but if there is a next time for you one this sale, it would probably be better to refuse to share a lawyer with your buyer. Too much opportunity for disabling conflicts of interest. The lawyer representing you should really not be in the business of advising your buyer. A lawyer, acting strictly in your interest, might have advised you not to enter into this contract unless Bob could provide proof he was free of the entangling-ness involving his estranged wife (and their house and any mortgage on it) since it was surely going to show up during the mortgage app process - and predictably at inconvenient points.

The tricky thing about selling property (especially FSBO) is that in many (most -perhaps except in the case of real estate investors) situations it not the same as buying a burger at McDonalds. The size of the purchase generally requires personal financing and that leads to inquiries into personal spheres that are normally out of bounds for relative strangers. Bob's marriage may have failed but until he has a final decree, or a legal separation agreement, his personal finances are considered the same as his wife's. So it isn't just him applying for a mortgage by himself, I'm sorry to say. Hopefully the bank has ways of sorting this out satisfactorily.

Mojo-machine in my basement is humming along with it's full strength beam aimed right at you. Hope by tonight you have more answers that smooth your path.


    Bookmark   October 20, 2011 at 1:38PM
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I think the only way to get off the note is to do a refinance. I might be incorrect, but am pretty sure on this. Hopefully Bob and the wife were able to do this.
Liro... here in NC, the same attorney is used for both sides 99% of the time. Me nor my clients have never ran into trouble because of this arrangement.

    Bookmark   October 20, 2011 at 2:30PM
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Oh LITH, you certainly are being tested for patience in this you are going to be a pro.

I too am disappointed today....we had a very promising showing...wife wanted our house....he wanted another...well "more room for the dogs" won out. It would have been a cash sale with closing in 3 weeks. Certainly would have worked out great for us ......but oh well, God give me patience~~~~

    Bookmark   October 20, 2011 at 6:12PM
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A comment about the Bob & wife's house... my hubby & I split amicably two years ago, and I went to a lawyer to change the house into my name. I refinanced to pay off my hubby.

Fast forward to October 2011, when hubby requests an (Equifax) credit check. The mortgage - which is in MY name - shows up on his credit check! And the amount is the refinanced amount, so it's not like their records weren't up to date.

All that to say, the bank may not have the correct info anyway :-(

    Bookmark   October 20, 2011 at 8:09PM
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Guys, there's no problem about the house Bob used to own with his ex-wife. That was taken care of before he even made an offer on my place. The problem is his ex-wife was late paying their income tax. It is now paid. Today I spoke to the loan officer. She has asked the underwriters for an exemption--to allow the loan to go forward. Otherwise we have to wait until the IRS reports back that it's taken care of. She said that could take 30 days! On a good note, she said that this is the only thing we're waiting for. Everything else looks good. On a bad note, the sellers of the house I'm trying to buy said they took a back-up offer and they are pressuring me for a closing date. My real estate agent thinks I could lose the house.

NC, yes, sharing a lawyer is the norm here too. I like it this way. There's less fighting like what happened with my other buyer in NJ. His buyer's lawyer found a small issue and long story short, caused the whole deal to collapse. The buyer was afraid to go against the lawyer. A lot of times they put fuel on the fire because that's how they make their money. In this case, there is really nothing that separate lawyers could have prevented. Bob is in violation of the contract because he missed the closing but I'm not going to squawk about stuff that he has no control over. I think he's doing the best he can.

Ottawavalleygardener, speaking of Equifax, we found a debt on our credit report from a company we never heard of. Equifax said they investigated and it's ours but they couldn't have because it's not. Now I'm fighting them. Lots of aggravation. Luckily we are not getting a mortgage for our new house but what if we were?!

    Bookmark   October 20, 2011 at 11:23PM
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Phoggie, I forgot to say--I'm real sorry that didn't go through for you. But it's a good sign! It means there's hope and another one will come along!

    Bookmark   October 20, 2011 at 11:25PM
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