I say mostly, because the same job that can bring such joy when people finally realize their dreams has also brought me some of the biggest heart-aches when I watch helplessly as their dreams go south…especially in the 11th hour!
Telling Sellers their home isn’t going to close
…in the 11th hour…when they have quit their jobs, have everything they own in a U-Haul and are ready to start out across the country…it is just heartbreaking.
And when it happens TWICE to the same Sellers…
Well, there just aren’t words.
The first time it happened was a fluke. One of those “I would never have anticipated this in a hundred years” type of situations.
Unfortunate… unforeseen… and unavoidable
The buyer had filed bankruptcy over 10 years prior, it included a mortgage, and had long since disappeared from the credit report. OK, we’re good. They made a mistake, worked hard to rebuild their credit and were ready to try it again. The mortgage rules they had to live by “any prior bankruptcy that includes a mortgage must have been dispersed (settled) at least 3 years prior”.
What wasn’t know was the bank that held the mortgage was in hot water over predatory lending practices and didn’t get around to completing the foreclosure proceedings for 8 YEARS! Instead of 3 years as the lender required, it was only a little of two years now and the buyer was no longer qualified.
Seller, Buyer, Agents and Loan Officers…we were all victims of the mortgage meltdown…years later… in a screwed up kind of way!
And my Seller’s dreams, so close to being a reality, were put on hold!
Back on the market, their wonderful little country home had an accepted offer within days, along with a back-up offer, and we were off to the races. This time it should be a breeze. The biggest stumbling blocks had already been completed – inspections and appraisal – and I could see this one at the closing table in a matter of weeks.
Full of confidence that this one was going to work, the sellers got busy packing. They put down deposits on everything from apartments to moving trucks, and attended to every minute detail. Nothing would be left to do but show up and sign when the lender announced “We’re clear to close”.
Shortly before we should have been wrapping everything up, the lender calls “Mr. Buyer hasn’t paid any taxes in 2 years and the IRS wants to talk to him”… (Gulp)
The underwriter’s condition? Make a payment agreement with the IRS, have proof you made your first payment and give us explanation of why you didn’t think it was necessary to pay your taxes….and it better be a DARN GOOD reason!
That got resolved…and quickly…so within two days the crisis was over. Whew! We dodge the bullet on that one!
But then we got the next bombshell – Mr. Buyer didn’t have enough money now to close…now that’s not so easily fixed!
A paycheck was coming in…good, bank statements could be printed and verified, great! We’re getting closer.
Then came the final blow…the bank statement showed a cash deposit for $1900 that couldn’t be verified. Even though the buyer HAD the money, it wasn’t “allowable” money under the rules and the whole thing crumbled around our feet.
I had to figure out how to tell my sellers…AGAIN…they wouldn’t be closing. My heart broke for them, my stomach was in knots from the stress…
Just how do you come up with the words that are going to turn someone’s world upside down? For a second time?
I found those words somehow, made the call, and was silent as their anger, disappointment and grief pour out all over me.
No, I don’t always love my job! Never..EVER…want to make a call like that again.
There’s some lessons to be learned here – there always is with a big, fat flop – and I want to pass them on.
If you are a buyer:
Do pay your taxes and have copies of your tax returns when you apply for a loan.
Do know how much money you need for closing…to the penny…then make sure it is verifiable with a paper trail.
Do have a bank account – and it’s VERY helpful to sign up for banking online for last minute verifications.
Don’t mess with your credit or your financial status from the time you have a pre-approval until the keys are in your hand….period!
- Don’t buy anything on credit or even open up a new credit account
- Don’t buy a car,
- Don’t buy furniture
- Don’t even buy food if you are short on funds
Some mortgage companies have credit monitoring in place so they are immediately notified if you submit a credit application.
If you are a seller:
Always, always have a contingency plan, because things can and do happen…sometimes even TWICE! Until you have the money in your hand, anything…and I mean anything can happen.
(Update) Just heard that our back-up offer is going to step up to the plate and will close in 20 days. Now that’s a call I will enjoy making!
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