Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
If the loan was approved, but then the approval was retracted, how is that different than not getting approval in the first place? How is it different than if the condo sale condition had been imposed before the loan was approved?
And how do we know we're getting the whole story? Is it possible the sellers could be annoyed at the buyer for reasons other than the delay?
Our contract does state that if we cannot get a mortgage, we do not have to close and can walk away. Since the lender would not allow us to close on house until we close on our condo, wouldnt that excuse us?
I am NOT a lawyer, but it seems like it would excuse you, in my non-lawyer opinion.
Do you have a financial misrepresentation clause in your contract? Because once his wife lost his job and the loan became contingent on the sale of the condo that needed to be disclosed as it is material. Out here it would be a no-brainer that the earnest money belonged to the seller if the buyer failed to terminate the contract after the job loss or failed to disclose the new required terms for the loan contingent on the sale of the home.
I'd be in agreement with you if the buyer had terminated after the wife lost her job, but that isn't what happened.
That is interesting! If the buyer knew their loan was in jeopardy and didn't take immediate steps to let the seller know, I guess that would seem like something a judge would consider.
It is very difficult to loss earnest money here. The only other applicable clause is..
***********************
2. ADDITIONAL FINANCIAL TERMS & CONTINGENCIES:
A. NEW LOAN APPLICATION: Within_____________ business days of Acceptance, Buyer agrees to (1) submit a completed loan application to a lender of Buyer's choice; (2) authorize ordering of the appraisal (per lender's requirements); and (3) furnish a preapproval letter to Seller based upon a standard factual credit report and review of debt to income ratios. If Buyer fails to complete any of these conditions within the applicable time frame, Seller reserves the right to terminate this Agreement. In such event, both parties agree to cancel the escrow and return EMD to Buyer. Buyer does -OR- does not
authorize lender to provide loan status updates to Seller's and Buyer's Brokers, as well as Escrow Officer. Buyer agrees to use Buyer's best efforts to obtain financing under the terms and conditions outlined in this Agreement.
************************
In general the Buyer agrees to allow disclosure of the loan status. So in general the Seller has direct access to the loan process. This would shift any burden of reacting to a change in loan status to the seller who really has only the choice of proceeding or calling the deal off and returning the EMD.
Oh, hell no! This only gives the seller permission to check with the lender to see what the status is of the loan IF THE SELLER CHOOSES. It does NOT absolve the buyer of the responsibility for meeting the terms of the contract, and it does NOT put the onus for "checking up" on the buyer with the seller. Good lord. Stop weaseling. It's ridiculous and demeaning.
OP, you KNEW you had a problem when your wife lost her job and you had to sell your condo before buying the new house. You decided that maybe you'd luck out. You didn't. You have caused the seller financial loss for delaying the sale, for which, IMO, they deserve to be compensated. If I were the seller, you'd be out your entire $20K, and I'd be under contract with someone else by this time, possibly even preparing for the closing. So be grateful they have been willing to continue to work with you, pay the $5K and be done with this.
Just going by what you posted about the contract, you could have walked away when your lender bailed on you when your wife lost her job, before AUGUST 26, the closing date on the contract that both parties signed. That is when you could have high tailed it out of there, not any day after August 26. Going beyond that date to close on the house was a risk. Unfortunately, it had bad consequences for you.
The sellers could have been nice about it and empathized with what happened, understanding it was unintentional and beyond your control. Heck, if they did not want to wait for you to sell the condo, they could have abolished the contract, since the original financing terms on the contract that both parties signed, fell through. I guess they did not have a back up offer.
I wonder though if them agreeing to delay the closing date until you sell the condo (aka new financing terms set by your lender) equates to them waiving litigation against you on the deposit.
Either way, it sounds like you both incurrred costs that was a result of closing a month after the closing date. I'm just sorry the sellers are being so greedy about it now after the dust has settled.
Oh, hell no! This only gives the seller permission to check with the lender to see what the status is of the loan IF THE SELLER CHOOSES. It does NOT absolve the buyer of the responsibility for meeting the terms of the contract, and it does NOT put the onus for "checking up" on the buyer with the seller. Good lord. Stop weaseling. It's ridiculous and demeaning.
OP, you KNEW you had a problem when your wife lost her job and you had to sell your condo before buying the new house. You decided that maybe you'd luck out. You didn't. You have caused the seller financial loss for delaying the sale, for which, IMO, they deserve to be compensated. If I were the seller, you'd be out your entire $20K, and I'd be under contract with someone else by this time, possibly even preparing for the closing. So be grateful they have been willing to continue to work with you, pay the $5K and be done with this.
I reread your posts and saw that you needed to give an answer a couple of days ago. Hopefully you came to a rational decision and cheerleading such as the above did not lead you to make a bad decision.
I remember your other thread about your mortgage officer refusing to issue you a denial letter when your wife lost her and you trying to get one. If you end up losing money on this I would see you can recover from the officer.
It's also of note that the hoa seems to be a big culrpit in this closing delay(in which alot.of the seller cheerleading seems to be missing). Make sure you use that if you have to go to court if hoa docs were a contigency.
I understand the 'time is of the essence' statement .. my question is, does it matter why we didnt close by Aug 26th (or contract)? It was not foreseeable or our fault that wife lost job and then lender put contingency on our loan to sell condo first. Does that matter or not at all?
Actually, it was VERY foreseeable that if your joint income dropped significantly, it may mean that you couldn't afford to carry two houses. The moment your wife lost her job, you should have been discussing the situation with your agent and the agent should have been renegotiating the contract. The seller may have been more amenable if they hadn't been kept in the dark and had nasty surprises sprung on them. Now, they don't trust you. Did you ever stop to think that your failure to close on time might have made a significant difference in THEIR plans? You act as if it's all the lender's fault for putting a contingency on the loan. I'm sorry your wife lost her job, but what I can't get over is that you KNEW this was going to be a problem, as evidenced by your earlier post, and now you seem to be surprised that a seller is actually going by the contract.
You and the seller agreed to a specific closing date. You violated. Your reasons and excuses don't matter. As a result of your violation, the seller suffered many losses. If you don't understand how or what, just ask him.
You wouldn't want done to you what you've done to the seller.
Oh, hell no! This only gives the seller permission to check with the lender to see what the status is of the loan IF THE SELLER CHOOSES. It does NOT absolve the buyer of the responsibility for meeting the terms of the contract, and it does NOT put the onus for "checking up" on the buyer with the seller. Good lord. Stop weaseling. It's ridiculous and demeaning.
OP, you KNEW you had a problem when your wife lost her job and you had to sell your condo before buying the new house. You decided that maybe you'd luck out. You didn't. You have caused the seller financial loss for delaying the sale, for which, IMO, they deserve to be compensated. If I were the seller, you'd be out your entire $20K, and I'd be under contract with someone else by this time, possibly even preparing for the closing. So be grateful they have been willing to continue to work with you, pay the $5K and be done with this.
Sorry but with the standard contract used in NV there would be no issue. The contract either continues as written and closes or the buyer gets his money back. The loan contingency is simple and requires that the buyer be able to get a loan. Had a deal this spring go to the day of closing when the bank underwriter canned it on the basis the buyer was not really going to live in the property. The underwriter was wrong but refused to budge. The earnest money however was never in doubt. We worked out new financing and closed three weeks late.
It may well be that the contract is different elsewhere though I would think any financial contingency that does not provide full protection for the buyer on a lender condition is very bad lawyering on someone's part. I would also think the holding of escrow by a non neutral is a terrible idea.
I too find fault with the OP or agent for not settling this matter prior to the closing. You don't let contracts deteriorate when you know there is a problem. But in this jurisdiction the one contingency that is virtually never waived and is always absolute is the financing one. I would think any agent who assisted a client in waving that clause and then had a problem is off into malpractice.
The seller may have been more amenable if they hadn't been kept in the dark and had nasty surprises sprung on them.…...
On one hand we don't know that this was "sprung" on them, as the OP isn't detailed about all the communications that took place about this -- AND how much more amenable do you want the sellers to be?….. they've waited about a month.
Quote:
The sellers could have been nice about it and empathized with what happened, understanding it was unintentional and beyond your control. Heck, if they did not want to wait for you to sell the condo,
How much more "nice" do you want them to be?…the delay has cost them money, and they still waited. They COULD take the entire deposit, INSTEAD they're only asking for 5K compensation to cover costs the BUYER'S delay caused.
Quote:
You have caused the seller financial loss for delaying the sale, for which, IMO, they deserve to be compensated.
Yep
Quote:
You wouldn't want done to you what you've done to the seller.
I do wonder how the OP would feel and what's he'd do if the roles were reversed. HE would' ask a buyer to compensate him for they delay?
Quote:
And how do we know we're getting the whole story? Is it possible the sellers could be annoyed at the buyer for reasons other than the delay?
That could be true too. But I'd imagine the delay has been aggravating enough.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
