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Old 06-27-2012, 12:56 PM
 
Location: Texas.
340 posts, read 1,278,108 times
Reputation: 125

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Have an agreed offer from prospective buyer, but waiting for them to show proof of lending. Is this listed on the Third Party Financing Addendum for Credit Approval form as to how long they have to show this? Not sure they are on solid ground for this purchase. Reason for asking : have another offer from previous showing that can show proof right away. I told them I had to give first offer a couple more days. No earnest money recieved yet or account started with title company. What is legal obligation?
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Old 06-27-2012, 01:02 PM
 
Location: The Triad (NC)
26,927 posts, read 58,138,086 times
Reputation: 29429
Quote:
Originally Posted by turnerfamily View Post
Have an agreed offer from prospective buyer...
No earnest money recieved yet..
...waiting for them to show proof of lending.
What you have is a conversation about the idea of making an offer.

Are you working with an agent or an attorney?
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Old 06-27-2012, 01:36 PM
 
Location: Austin
7,089 posts, read 16,951,642 times
Reputation: 9522
They don't have to "show" anything until the day of closing, by signing the closing documents. If you read the Third Party form, it states that if the buyer doesn't get their approval within X number of days, they can give you written notice to extend this period or terminate and retain their earnest money. No where does it say they have to show you anything. Even if they don't have their approval by that date, they still don't have to give you any notice. They can continue and the contract is no longer contingent upon the financing.

If your "contract" is signed, and you don't have a "kick-out" addendum, you must let this buyer run their course.
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Old 06-27-2012, 02:02 PM
 
4,631 posts, read 7,234,753 times
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When I was a realtor in TX, I never presented a written offer to my sellers without an Earnest Money check in hand.
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Old 06-27-2012, 02:59 PM
 
Location: Austin
7,089 posts, read 16,951,642 times
Reputation: 9522
Quote:
Originally Posted by ocngypz View Post
When I was a realtor in TX, I never presented a written offer to my sellers without an Earnest Money check in hand.
That's just not realistic in today's world of electronic signatures and not being in the same room together writing an offer.
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Old 06-27-2012, 05:52 PM
 
Location: Mokelumne Hill, CA & El Pescadero, BCS MX.
6,958 posts, read 18,577,183 times
Reputation: 6356
Quote:
Originally Posted by FalconheadWest View Post
That's just not realistic in today's world of electronic signatures and not being in the same room together writing an offer.
I insist on having at least a copy of their check in hand, if not the check itself. One of the most important parts of a contract is the consideration paid. Without EM, there is no offer. At least in CA practice.
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Old 06-27-2012, 06:15 PM
 
Location: Texas.
340 posts, read 1,278,108 times
Reputation: 125
So let's disreguard the earnest money loss or gain for now. The buyers " credit approval" is obtained when "every reasonable effort" is made to obtain that financing for purchase. Is there any way to determine if the buyer "can" make this purchase before closing ? (besides the bank lender). Who determines if the proof of finance is valid? How is the title company involved in this if buyer fails to generate funds at closing? Who pays for title co. at that point?
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Old 06-27-2012, 07:01 PM
 
Location: The Triad (NC)
26,927 posts, read 58,138,086 times
Reputation: 29429
Quote:
Originally Posted by turnerfamily View Post
So let's disreguard the earnest money loss or gain for now.
Do so at your own peril.

Quote:
Is there any way to determine if the buyer "can" make this purchase before closing?
Ultimately... NO. This is a primary reason to have that earnest money of theirs at risk.
And a date certain for a loan pre-approval package that demonstrates their assets and income.

Quote:
Who determines if the proof of finance is valid?
You do... along with your attorney/agent/title co in the constantly flowing serial process leading up to the actual day of closing do. Guess what happens sometimes on closing day?

[quote]How is the title company involved in this if buyer fails to generate funds at closing?
Their representative will be the one across the table from you with a similarly angry countenance.

Quote:
Who pays for title co. at that point?
Look at the contract for details but generally only the ones with money can pay a bill.
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Old 06-27-2012, 09:05 PM
 
Location: Texas.
340 posts, read 1,278,108 times
Reputation: 125
I would have to say the earnest money is a small compensation for the expierence if the buyer can't fullfill the purchase. Maybe 5,000.00 earnest money might weed out the hopeful thinkers.
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Old 06-28-2012, 06:19 AM
 
Location: The Triad (NC)
26,927 posts, read 58,138,086 times
Reputation: 29429
Quote:
Originally Posted by turnerfamily View Post
I would have to say the earnest money is a small compensation for the expierence...
Uh huh...

You still haven't answered with what your agent or attorney are saying.
Do you even have an agent or attorney?
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