Closing date keeps changing (documentation, agent, mortgage, mortgage)

[delta07]

I am selling my home to a buyer who is getting a VA loan. This process has been nothing short of a nightmare for us. When we got the offer on the house (full price) we were excited to say the least! Now we almost wish we would have refused the offer and accepted a lower priced one (I'm sure our realtor wouldn't have done this anyways). The closing date has changed several times and we are beginning to wonder if the deal is going to actually go through. As part of the offer we were given less than 30 days to close, which in hindsight, seems rediculous for a VA loan. Because we were moving out-of-state we rushed to find a moving co. and had to pay $750 extra for an exact day pickup. We found a rental house and thought everything was good. Then we got a call from a realtor on June 30th (one day before closing) saying the buyer didn't get their loan yet, so we needed to do an extension on the closing. We signed for a closing date of July 15 or sooner. I talked with our realtor last week and the loan still hadn't gone through. Now we have one day until closing, I haven't heard anything from our realtor, and I'm getting very worried. Is is common to not hear of anything before the closing? We are out-of-state, so our realtor has power of attorney for us. He is supposed to email us the closing documents to view before he signs for us. Wouldn't you think he would give us a day or two to look them over? Any suggestions or advice on what to do would be greatly appreciated!

[Silverfall]

Wow...you gave your agent power of attorney?
Most people just overnight docs or do courtesy signings..Anyway...I digress...

VA has been slow lately. I would find out what the hangup is. Is there a document missing, etc?

[TexasHorseLady]

I've had several buyers with VA loans lately, with no problems, but they've all been through USAA (who seem, in my experience, to be very good about getting things done right and on time).

Have you at least received the HUD statement?

I've had cases in past (not VA) where the lender didn't get the docs to the title company until the day of closing. But your agent (and I'm boggling, too, that you gave him, and he accepted, Power of Attorney) should at least fax or scan and email the docs to you ahead of time so that you can see what he's signing for you. Though it will likely be a LOT of pages.

First thing, though, is for your agent to find out what the hold-up is and let you know. You might need to be pro-active and contact him to get him to do this.

[delta07]

I guess I didn't realize giving my agent Power of Attorney was such a big thing. He was the one who recommended it. At the time, our closing date was scheduled for July 1st, which was a time we were going to be in MT with limited access to a computer and fax. It seemed like the best option.

Anyways, I have been proactive and contacted my realtor, but all I get is reassurance that the deal is going through. I'm very naive when it comes to real estate, so I don't necessarily know what documents I need, etc.

What is the HUD statement? No, I have not seen this. I haven't received anything!

[TexasHorseLady]

The HUD is, briefly, the document that spells out, in detail, where all the money is going. It has columns for the seller and the buyer, what each party is paying for, what is going to each party, etc. You're supposed to get that to review before the closing so that if there are any errors, you can inform the title company and they can correct them and bring said corrections to the attention of the lender who has to approve the changes. It can't be created, though, until the lender sends the docs to the title company (assuming you're in a state where a title company handles the closing).

I've had closings where the seller was in North Dakota, say, and the title company simply mailed them the documents to be signed in front of a notary. Another option is to have a notary where you are located meet with you while you sign the documents. I've never known of a situation where the agent had Power of Attorney, so it took me somewhat aback.

[delta07]

Thank you TexasHorseLady! I haven't received anything, so I'm guessing the closing isn't going to happen tomorrow as planned. And yes, Colorado is a state where a title co. handles the closing, so it sounds like the loan hasn't happened yet. This is very irritating to say the least. I actually passed on an opportunity to go on a 5 day wilderness rafting trip because the closing fell during the trip. This is supposed to be hubby and I's vacation time together before he starts his new job. Instead we have to spend it close to phone/computer waiting on our house to close!

What really bothers me is that the buyer originally stated in their offer that they would go with a conventional loan if they couldn't get the VA loan in the time stated. That never happened!

Another question I have, that you or others may be able to answer, is what happens now? I tried to call my realtor this afternoon, left a message, and haven't heard back. When we did the original addedum to the contract, we had to sign to change the closing date before the original closing date of July 1. We signed on June 30. Tomorrow is our scheduled closing date, and we haven't signed anything to extend that. Are we now in breach of contract? Seems to me that we would be. What happens in this situation?

[TexasHorseLady]

You know, you might want to call your agent's broker, if he's not returning calls and you've got a closing scheduled tomorrow, to find out if it's actually going forward. Because if it's not, you really should have an amendment to extend. At the same time, you can ask the broker what's going on.

As for what happens, if all parties are in agreement, you can simply extend tomorrow. It's when the parties aren't in agreement that it gets sticky once you've gone past closing. That's the reason for the amendments, to keep everything in writing so there's no question if a disagreement should arise.

[Rakin]

I would not touch a power of attorney for one of my clients with a 10ft pole. Talk about conflict of interest or a liability issue for our broker.

If you do a POA, is there not a family member or close friend you trust?

[delta07]

We have already done a POA with our realtor. Maybe we shouldn't have, but that is said and done.

At this point, we are stuck between a rock and a hard place. We are really not in agreement to an extension on time. We need the money now! However, if they don't have the loan then we are back to square one, putting it back on the market. We don't want to do that either.

[Silverfall]

Originally Posted by delta07

We have already done a POA with our realtor. Maybe we shouldn't have, but that is said and done.

At this point, we are stuck between a rock and a hard place. We are really not in agreement to an extension on time. We need the money now! However, if they don't have the loan then we are back to square one, putting it back on the market. We don't want to do that either.

You probably used our standard OREF contract. If the buyer fails to perform on the contract as outlined you could refuse to extend and then be entitled to the earnest money unless the mortgage broker signs a doc stating they didn't qualify for a loan, in which case they would get the earnest money. Our contracts calls for an application for loan to be within 3 business days of mutual acceptance.

A two week extension is a lot of time out here. What is the mortgage broker telling your agent. Ask him for specifics. Has the underwriter SEEN the documents yet? Is the underwriter requesting further documentation? What exactly is the hold up. Until you know the problem, it will be hard for you to decide a course of action.