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.
What are my protections to get the equity earned of a (just in case) rejected mortgage application? I closed the pre-approval deal with a new builder back in winter 2020 when the price was $200,000 less. Today, the base price may approach up to $200,000 higher when I close the transaction by August 2021.
The last thing in the world for me is to allow Fannie Mae lender forcing me to cancel the mortgage application, and all the $200,000 equity earned will return back to the builder, then they resell the property at $250,000 higher price (with all the options) as a quick move-in. I don't get a single penny back, while they also get to keep (and profit) my $6,129 deposit too.
What are my EMERGENCY options here? Can I sell or transfer my pending mortgage application to a realtor agent for full-cash closing price, and then in return they hand me the (whatever left, after commission) equity earned? Or, am I totally out of luck?
What are my protections to get the equity earned of a (just in case) rejected mortgage application? I closed the pre-approval deal with a new builder back in winter 2020 when the price was $200,000 less. Today, the base price may be up to $200,000 higher when I close the transaction by August 2020.
The last thing in the world is Fannie Mae lender forces me to cancel the mortgage application, and all the $200,000 equity earned will return back to the builder, they resell the property at $200,000 higher price as a quick move-in, and I don't get a single penny back, while they also keep (and profit) my $6,129 deposit too.
What are my EMERGENCY options here? Can I sell or transfer my pending mortgage application to a realtor agent for full-cash closing price, and then in return they hand me the (whatever) equity earned? Or, am I totally out of luck?
It sounds like you are asking if you can sell your purchase contract. If that's the question, then I would say that the answer is likely "Yes", but it would depend on the exact wording of the contract.
Even if you can sell it, I doubt that a "realtor" would be the purchaser. More likely it would be an "investor" or perhaps just someone else who wants to buy a house.
Mortgage approval is usually a contingency in the contract designed to let the buyer off the hook if they can't obtain financing as they hoped to do. If your mortgage is not approved, you still have the option of coming up with the necessary cash from some other source, but that's not a realistic option for most buyers.
Why would you NOT get approved for the loan? Certainly the house should appraise high enough. Is something wrong with your credit? Did you lose your job? Details matter.
Edit: Generally, if a buyer is unable to get financing as called for, the earnest money is returned to the buyer.
Mortgage approval is usually a contingency in the contract designed to let the buyer off the hook if they can't obtain financing as they hoped to do. If your mortgage is not approved, you still have the option of coming up with the necessary cash from some other source, but that's not a realistic option for most buyers.
Unfortunately, all of the builders require "no contingency" attached for all buyers looking for new construction homes into mortgage application that I already signed up for. This is not a used property where a "contingency" is available as an option. What does this mean, and is this worse?
Unfortunately, all of the builders require "no contingency" attached for all buyers looking for new construction homes into mortgage application that I already signed up for. This is not a used property where a "contingency" is available as an option. What does this mean, and is this worse?
Without seeing your contract, I don't really know what options you may have. I also don't have much of an idea of what your exact financial situation and financial concerns are. I'm also confused as to why you would sign a contract to purchase over a year ago, and are just now wondering how you're going to come up with the money or what you will do if you can't. In short, there are just too many pieces missing from this jigsaw puzzle for me to speculate as to the outcome. Good luck.
Read your contract and see what it says about selling or transferring the contract. The contract is what matters, you wouldn't be selling or transferring a mortgage application.
Without seeing your contract, I don't really know what options you may have. I also don't have much of an idea of what your exact financial situation and financial concerns are. I'm also confused as to why you would sign a contract to purchase over a year ago, and are just now wondering how you're going to come up with the money or what you will do if you can't. In short, there are just too many pieces missing from this jigsaw puzzle for me to speculate as to the outcome. Good luck.
Still looking for more experts here to answer my concerns carefully...
It's a brand new 3,500 sq. ft. house that I'm trying to close for $720,000 price (with all options, including mandatory "stupid" $25,000 solar from $609,990 base price) in overpriced California area. Today, the base price shows $712,990, solar not included, now already over $100,000 equity earned so far. It's expected to appreciate in value, closer to $920,000, by August 2021.
Which means, some applicants in California (because of higher home prices) do ask for down payment assistance from their family members or friends, which is actually kind of normal.
...But my parents appear to back away a little, sadly, or showing some kind of weird facial expressions. Not official yet, and it's only 20% chance that they will say no. I don't qualify at all for the full $720,000 loan amount. I know I need to prepare for the worst, and I'm scared. The greed takes away all my profits.
IMHO you are getting ahead of yourself with this focus on "earned equity". Spend your time and energy figuring out how you can make it to the closing table.
It's not your equity because you don't own the house.
Trying to figure out what you are talking about, I am guessing that you signed a contract for a pre-construction house that will be finished this summer and you are going to have to come up with the agreed upon purchase money when the house is finished.
If you can't pay, then you won't own the house. It's as simple as that. If you want that house, you had best figure out where the money is coming from.
Why did you sign a contract for a house that you don't have the money to pay for?
Read your purchase contract carefully. Normally on pre-construction purchase, you won't be able to assign the contract to another buyer. If you can't pay, then the builder keeps your down payment and you don't get the house.
However, every contract is different so see what yours says.
And get busy to figure out where to get the money to fulfill your end of the contract.
IMHO you are getting ahead of yourself with this focus on "earned equity". Spend your time and energy figuring out how you can make it to the closing table.
The home builder, of course... We live in a corrupted society today that America hasn't been truly great since the 1980s, when things used to be much more fairer with affordable home prices. I would much rather go back to that time any day of the week than today.
Every builder is anxious to cancel my mortgage application, and resell the property as a quick move-in for $250,000 to $300,000 profit higher from old (no longer available) $609,990 base price. This is a HUGE chunk of money, not few dollars. If the equity was only $50,000 gain, like most parts in America, I would allow the builder to cancel my mortgage application. But, not this unusual situation that I'm facing.
Last edited by waltchan; 04-03-2021 at 11:22 AM..
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.
