Help me save this deal - Mortgage co. problems - Posted by Danie

Posted by Danie on February 29, 2000 at 23:52:41:

We have bent over backwards for these sellers. We originally wanted early possession because we had a tennant who was willing to rent and offered to pay the mortgage payments until closing. They were so afraid of this creative financing they wouldn’t do it and ended up paying the mortgage themselves. I don’t understand people sometimes. We even had our attorney draw up an agreement that made us responsible for damages.

But all that is over now. We are schedule to close Thursday.

Thanks for the idea.

Help me save this deal - Mortgage co. problems - Posted by Danie

Posted by Danie on February 29, 2000 at 11:29:30:

Heres the scoop. I Entered a contract to purchase home. Closing was set for Jan with 30 day extension. During that time. Found a tennant. Tennant was interested in purchasing but did not think she would qualify for a loan I was willing to do a lease purchase. Tenant applied for loan and was approved for FHA loan. Since she was approved we did not apply. I Thought I could do a simultaneous closing. This has been the biggest nightmare. The first stumbling block was the seller was selling as is. When the appraiser came (our buyer paid for that) he found about 800.00 worth of fixes before he would sign off on the appraisal. Me and my buyer split the cost of the fix ups. We are now 30+ days beyond closing date and sellers want to back out (we would lose all monies put towards the deal with lawyers fees about 500.00 for me about 700.oo for my buyer). The sellers say closing is taking too long. I don’t think they have a new buyer but are well within there rights. I’ve tried to reassure them. We finally have a closing date wed 03/01. TODAY’S PROBLEM: The mortgage company says it will not allow a show of funds going to us as an assignment. My question: Why do they have to show it as a assignment? On our buyers papers shouldn’t we be listed as the sellers and her the buyer? I thought our sellers name should have not been shown. What’s gone wrong!

Need to consider some other options - Posted by Michael Morrongiello

Posted by Michael Morrongiello on February 29, 2000 at 15:01:02:

Dannie:
Many lenders get skittish where they see you are selling a home that you technically do not own (at least not at the moment). When you try to educate them about the facts; That you are under contract to purchase the home for one price and then re-sell it immmediatly for a higher price, they get even more concerned about the “Real World” value of the home.

If your contract with the sellers is assisgnable and it sounds like it is and the mortgage company will not recognize that you have assigned your rights within that purchase sales contract to these buyers for a fee, then you need to start looking at other options.

I don’t know the actual numbers on your deal. What you are buying for? and what you are selling for? What do your buyers do for a living? How much cash are they putting down? What is their credit and credit scores like?
If there is enough spread in the deal perhaps you can sell to them and take back an owner financed note that could then be sold to generate enough cash to payofff your seller and allow you to fufill your contract obligation with him/her.

Michael Morrongiello

Re: Help me save this deal - Mortgage co. problems - Posted by JoeB(Atlanta)

Posted by JoeB(Atlanta) on February 29, 2000 at 14:28:52:

Hi Danie, it sounds like what happened is that the lender and/or atty didn’t understand that you wanted to do a simo closing and they’re simply doing an Assignment of Contract instead. If it’s the lender’s atty and not yours(which it probably is), you can TRY harder to educate him/her about simo closing, so they WON’T have to do just one closing and won’t have to SHOW your assignment fee.

To make your original sellers happy: if you have decent profit in the deal, I would offer them maybe a $1000 or more of a)additional non-refundable earnest money or b)additional purchase price.

Hope this helps,
Joe Brillante

Re: Need to consider some other options - Posted by Danie

Posted by Danie on February 29, 2000 at 23:41:02:

Thanks so much. As soon as I read your message the light came on in my head. I could have cut my leg off and kicked my own butt. This deal could have been closed in January if I had used this method. I will use it next time. I wish I would have posted a message months ago.

You asked about the figures. We contracted the purchase for 56,000 and contracted the sell for 66,000.

We solved the problem. Closing is set for thursday.

Thanks again