RE:closing problems - Posted by Tom Chang

Posted by Nate(DC) on June 30, 2003 at 12:43:41:

No, HUD does things their own way. If you want an extension from them, you DO have to pay. And they know you can’t strong arm them.


RE:closing problems - Posted by Tom Chang

Posted by Tom Chang on June 30, 2003 at 09:34:09:

I am supposed to close on a house tomorrow, but found out last friday that I could not because the bank’s attorney did not received any documents from my lawyer( title insurance etc.) I had called my lawyer multiple times in the last couple of weeks asking if I needed to request an extension from the seller and was told “no”.
Now I have to pay a fee of $375 to get a 15 day extension… that if they will even grant an extension.

What action should I take now and what options do I have in sueing the lawyer for his failure in getting me to close.


Re: RE:closing problems - Posted by River City

Posted by River City on July 02, 2003 at 14:30:47:

I believe that the contract you signed spells out HUD’s extension fees. HUD usually wants purchasers to know about their fees on the front side so that there are no problems down the road with someone saying they didn’t know. I have never seen HUD waive these fees for anyone.

Re: RE:closing problems - Posted by Frank Chin

Posted by Frank Chin on June 30, 2003 at 09:54:19:

Hi Tom:

First, I’m not an attorney.

But, does your contract have “Time is of the essence clause” in it?? Probably not, and if you had an attorney advisng you, he would not allow it in the contract.

I’ve purchased and sold properties thru the years, and more often than not, whether I was the buyer or seller, the original closing date was not met.

Attorneys here in NYC tells me that there’s an unwritten rule where there’s a 30 day automatic extension - so I wouldn’t go volunteering to pay for extensions. There’s probably a similar situation where you are - but you’ll have to check with your attorney as to the local custom.

Your attorney can also file a “memorandum of contract” to make it difficult for the seller to try selling to someone else, and your attorney can tell the seller, or his attorney that you will sue if they try selling to someone else.

I was a buyer once, and went beyond 60 days a 60 day extension, and the seller would not grant an extenion. We bluffed our way thr another 30 days, only to make a payment when we needed another 30, but advising the seller that he can be sure the sales with another buyer would be tied up in court for a long long time.

We filed a memoradum and the sellers attorney advised his client his best bet is to close with me.

Frank Chin

Re: RE:closing problems - Posted by Tom Chang

Posted by Tom Chang on July 02, 2003 at 15:43:03:

River City,
Have you ever heard of HUD lowering the price, or making repairs on a property that has a violation, or is missing a CO on a portion of the property.

Great advice! nt - Posted by John Merchant

Posted by John Merchant on June 30, 2003 at 10:33:26:


Re: RE:closing problems - Posted by Tom Chang

Posted by Tom Chang on June 30, 2003 at 10:01:09:

Thanks Frank!
Do you know whether the actions you took would be applicable even in a HUD foreclosure sale, because the seller is HUD working through a private real estate managment company.


Re: RE:closing problems - Posted by River City

Posted by River City on July 03, 2003 at 08:26:21:

You don’t indicate what the “violation” is. It may or may not be a “violation” that would/should affect the sale of the property. It might affect the sale as far as you are concerned, but not HUD, since it evidently was not a violation when the loan was originally made and insured by HUD.

Yes, I have heard of HUD giving an allowance in the contract to cover repairs. The monies are held in escrow by the closing agent, and upon proof of completion the funds are released to the purchasers. These types of funds are usually negotiated along with the contract. It is probably too late for that now.

I would suggest that YOU write a letter to HUD and tell them in the letter the problems you are encountering. If you want to go through your real estate agent, that is ok, but you might want to make sure the letter gets to HUD (and fast). Who knows? It might work. Let us know the outcome. This could prove to be of some particular interest to the mortgage folks like myself that visit this site.

Re: RE:closing problems - Posted by Frank Chin

Posted by Frank Chin on June 30, 2003 at 15:06:06:

Hi Tom:

I have not bought from HUD, so I can’t tell you its peculiarities.

I’ve been doing refi’s and the bank tells me appraisers and title companies are swamped. The last refi I did took several weeks longer than expeected. I filed an application for another refi on 5-21-03, and its on the way to a rate lock as of today, with the commitments being prepared. But I purposely didn’t push waiting a bit for the FED to lower the rates.

So I think that could well be the problem.

I agree with Nate that you can’t strong arm HUD as you would a regular seller. Try calling someone in charge, talk nice, and explain the problem. Get the name of the guy you talked to, the date, and what he said.

Chances are, you get the run around, which is fine, and you go on to your next step.

My wife worked at HUD, and she tells me they take notice if someone complained to their Congressmen. If I were you, find out your Congressmen is, call the office, and find out what they need from you. They’ll ask you to write a letter, explain the problem, document whom you spoke to etc., as I suggested earlier.

We had a problem getting some documents from the INS, got the run around for months and months. My wife called the Congressmen’s office, wrote the letter as requested, and walked it to his office on Monday. The documents they claimed they misplaced came on that Friday.

Same thing with gargage pickups. I was tired of them of picking up one of two cans. Many neighbors had the same problem, called the city, and got the run around. I called my local councilman, and the Sanitation Dept called me and sent a special truck. When my wife worked for the phone company, complaints coming thru the “Public Service Commission” is handled immediately.

If all else fails, it might make an interesting story with the local paper. I’ve done that too. The reporter called the President of the Insurance company to get my problem resolved. The company President promised to take care of it “that Friday” according to the newpaper article.

REI, is like anything else, as the old saying goes “The squeaky wheel …”

Good luck.

Frank Chin