t-mac-mo maybe someone at committee level (that could be one person or a true committee) saw something in this loan that spooked them. It could have something to do with the property, the purchaser or nothing to do with either but rather an area perception. Perhaps they had a number of foreclosures in the area or structural problems with another house in the area. Perhaps the original person that OKed the loan overreached their authority to approve the loan. There may be a new boss and all loans are being reviewed before funding. There may have been huge losses within the bank and they are tightening their standards.

the buyer's lender wants changes in the contract (removing the washer/dryer, refrigerator, and window treatments from the contract, the very same contract they had already approved),

Why is *THIS* the lender's business?

These are not material. Not really. Not when a new fridge, washer/dryer, etc., can each be had for about $600.

Financial details of the loan, OK. But those things? They are just not important enough, and they shouldn't matter to the LENDER!

That seems so weird.

I can understand re-appraising. I can understand an objection to the sale price, bcs it affects the loan amount and the collateral. I can understand a last-minute check of the borrower's income, assets, etc.

But the washer, dryer, and fridge? Curtain?

My guess is they(the bank) want those things removed to be certain the items are not "part" of the home's purchase price...The bank likley does not want to finance those items.

t-mac-mo, while I sympathize with you over the frustration, this rings bells of back to the days when lenders actually crossed their "t's" and dotted their "i's" two and three times over to make certain that the mortgage was being issued responsibly.

IMO...this is a god sign in general..that perhaps some lenders are actually once again performing due diligence, which in the long run is the way it should have been all along...as we would not be in the financial pickle that we are in now...

Best wishes to you..I hope this all works out.

I think t-mac-mo's main complaint is the timing. They received a call after business hours yesterday and the closing is noon today. That really is very inconsiderate, esp. if people were led to believe that all t's were crossed and i's dotted on the 31st.

t-mac-mo maybe they buyers haven't been completely up front with you.

"the buyer's lender wants changes in the contract (removing the washer/dryer, refrigerator, and window treatments from the contract, the very same contract they had already approved),
Why is *THIS* the lender's business?"

Actually its never really made sense to me that lenders were willing to finance those things in the first place. The loan is underwritten on the assumption of increasing value from real property, whereas appliances and window treatments are depreciating assets.

Solie, you're absolutely right - my complaint is the timing. I have NO problem with the t's being crossed and the i's dotted. I know that those things not being done the last few years is the main reason we are getting less for our house now than we would have a year or two ago. I can live with that. It's the fact that they had all this information up front, approved the contract as initially written, issued a loan commitment on 1/31, and then less than 18 hours before closing, do this. Doesn't the word "commitment" mean, well, COMMITMENT? I just feel like waiting until the day before closing, when people have paid deposits for movers, put down deposits on other living arrangements, etc., is hugely inconsiderate.

I just figured, things like washers & dryers were included in the contract, because, well, that's the place they go. Where else would they go? They're part of the SALE, and the contract is about the SALE, not about the loan.

I never thought that they were MATERIAL to the LOAN company.

As long as they don't really affect the value of the house, it shouldn't matter to the loan company; they're just extra info that's in there.

The sale contract could have any number of non-monetary things in there (insisting on a repair of the squeaky back step, for example; asking the seller to repaint the bright-red living room to be white; renting back; being allowed to leave something in the shed), and they shouldn't matter to the loan company.

Hi t-mac-mo,

So, we got an offer on Jan 24, closing scheduled Feb 7 (tomorrow) at noon. Contract had specified a close on or before Feb 10. A short window, but okay, it's sold, we'll take it.

OK... stop for a moment right there... STANDARD industry turn times for purchases are 30 days from contract, which allows for surprises, reviews, and compolications. SOMETIMES it can be done quicker, but generally only when there is a good tailwind, and there are no surprises (which you can never guarantee in advance.)

The fact your deal had less than a 2 week turntime window was a "pistol to the temple" from the beginning... it was doomed in advance.

The buyers had pre-approval, received the "final" financing commitment on 1/31, things look great. We're scrambling to get everything done, find a rental to live in until our build is finished, etc. TONIGHT at 6:45 we get a call from our agent that the buyer's lender wants changes in the contract (removing the washer/dryer, refrigerator, and window treatments from the contract, the very same contract they had already approved), AND a second appraisal! Said appraisal to be done "in-house", or a "soft" appraisal, I think is how our agent phrased it.
My question is how, if the lender has already issued the financing commitment, approved the contract, etc., etc., they can at the last minute pull this crap?

A "commitment" in the residential financing world is ALWAYS conditional unti the funds clear, the title transfer is recorded, and all timeframes for litigious reversal have expired.

Do they not get that people's LIVES are affected here, ours, the buyers, the agents (it's their income)?

You need to remember that INVESTOR'S lives are affected if your deal goes south as well, and the lender's underwriting process is the ONLY screening protection of the investors' funds (which very well may be a significant portion of your OWN retirement accounts, whether you realized it or not.)

What is the point of waiting until the last minute to decide all this?

Same point the buyer & seller had in setting an unrealistically short escrow processing period. The lender wasn't given the choice.

Just because they can and they hold all the cards?

Because they are held responsible for the investor's funds safety.

Can somebody tell me what this is really about?

"The Golden Rule" ;~)

Cheers,
Dave Donhoff
Strategic Equity & Leverage Planner

Hi Talley-Sue,

the buyer's lender wants changes in the contract (removing the washer/dryer, refrigerator, and window treatments from the contract, the very same contract they had already approved),
Why is *THIS* the lender's business?

Because the lender is responsible for making sure the funds are ONLY going to finance what is allowed within the selected loan program's guidelines.

Virtually no mortgage guidelines allow the financing of window blinds, or other personal effects (which include anything not permanently affixed to the structural home.)

If the buyers balked at paying the nominated selling price without the contractual assurance that they were getting fishbowls and petunia pots, then it would be clear and obvious that these items represented value above & beyond the lienable structure.

Cheers,
Dave Donhoff
Strategic Equity & Leverage Planner

I would suggest to your agent/buyer's agent, that you might consider talking to a lawyer for fees you have had to come up with--apt rental etc.

Dave, so where do you put stuff like the washer/dryer?

I've always assumed that those things go in the contract because there isn't anywhere else for them to go.

I always thought that these kinds of items did not add to the price of the house but were thrown in as bonuses to entice the buyer to buy your house instead of the one down the street.

We write personal property inclusions and exclusions in our contracts, which are transfered by a "bill of sale".

"....funds are ONLY going to finance what is allowed within the selected loan program's guidelines."

Is the key verbiage, and agents should consult with the lender before writing the contract of what is or is not acceptable, like, "the antique red corvette in the barn with 600 miles on it", should probably not be a part of the contract price consideration.

Thanks for your input, Dave. Perhaps part of my frustration is not understanding how the process works. I know it was a short turnaround, but I just don't understand why these questions and issues were not raised before they issued the financing commitment on the 31st. What it FEELS like is that everything was moving along just fine, buyer complied with everything, we complied with everything, and then the day before closing, somebody at the lender thought, hmmm, closing is tomorrow, do you think we should look at the details? Maybe you can enlighten me as to why this would not have been looked at before?

Hi TalleySue,

Dave, so where do you put stuff like the washer/dryer?
I've always assumed that those things go in the contract because there isn't anywhere else for them to go.

They can still go in the P&S Contract as they are seperately identified as personal effects not included in the purchase price itself. That's the way to have them fly by underwriting no problem.

Berniek's got it down... a seperate bill of sale for the private effects works well.

Hi T-Mac-Mo,

Perhaps part of my frustration is not understanding how the process works. I know it was a short turnaround, but I just don't understand why these questions and issues were not raised before they issued the financing commitment on the 31st. What it FEELS like is that everything was moving along just fine, buyer complied with everything, we complied with everything, and then the day before closing, somebody at the lender thought, hmmm, closing is tomorrow, do you think we should look at the details? Maybe you can enlighten me as to why this would not have been looked at before?

I can't offer you a logical supportive reason, but I may be able to shed some light on WHY it could happen this way.

The mortgage process is a "pipeline" where an individual file goes through many stages of eyeballs... each one having a certain thing to watch for, do, sign, stamp, adjust, whatever... and while they know what they are doing, every single file they touch is somehow unique and different, and many threaten "hidden stink bombs." Each eyeball is aware that there are bombs SOMEWHERE, but never know WHICH is the hiding stinker.

NOW... at any point in time there may be a flow of dozens (or even hundreds) of files by a specific position or person in the pieline flow.

FURTHER, that flow modulates... surging to greater flow sometimes... slower others.

FURTHER, that flow may be a mix of refinances (which tend to not have as tight and solid deadlines) versus purchases, which have contractual deadlines. This oil-and-water mix creates havoc in setting priorities, as you can't push back ALL refinances... but that means at some point in the triage there are SOME purchases that have to wait a few days for their eyeball turns.

When things surge erratically, people get naturally overwhelmed...
When management knows that surges have happened, they may "stop the assembly line" to double and triple check for errors (which could explain the requirement of an additional appraisal on your deal.)

Suffice to say, it is not a case of "one loan file, singularily walking itself down the path as needed."

Hope that helps... you probably deserve to be frustrated, even a bit angry... however, toss a whiff of sympathy to the unheralded admin or underwriter silently toiling under stacks & stacks of queued up files. They KNOW there are lives being affected (really... they really really do,) and yet they face incredible pressure.

Cheers,
Dave Donhoff
Strategic Equity & Leverage Planner

Dave - thank you. That is truly very helpful. Part of the frustration was that it seemed so capricious, but your description really helped to explain the process, as well as put some human faces to it.

We are now tentatively scheduled to close around 3:30 this afternoon, in order to give the title company time to get the numbers together. Our agent is concerned that is so late in the day that it will not fund today, but at least it seems to be a go now.

THanks, all, for your comments. I'll keep you posted!

Wow... so closing rescheduled for late Friday afternoon, everything looks good, they've said it can be funded that same day so we're good to move over the weekend -- and an hour and half before the scheduled close, we get another call. THere was one MORE piece of documentation being required by the buyer's lender that the buyer's agent, it appears, should have been on top of. So....reschedule the movers AGAIN, reschedule the utilities AGAIN, take off work AGAIN...call the landlord of our prospective temporary rental home AGAIN... and sit on pins and needles all weekend. CLosing now scheduled for MOnday. Moving on Tuesday if all goes well.

BTW - Can we ask the buyer's agent to forgo some of his commission to reimburse us for all the lost work time this has cost?

I feel so badly for the buyers too, as I'm sure this is hugely stressful for them as well.

Some of the famous fairy dust (and more importantly, prayers for all involved) would be really welcome at this time.

Why is it the buyer's agent's responsibility? The agent doesn't usually provide documentation for the buyer. It is the lender's responsibility to make sure that they have all the documentation in order. It sounds to me like the closing timeline that you and the buyer agreed to didn't match up with the normal timeline for the lender.

I guess because it's my understanding that part of the agent's job is to make sure that the buyer knows what's needed, acting as liaison, making sure all the various pieces from their side are coming together to make sure the closing happens, just as our agent is advising us and "directing traffic" as to what we need to do, inspections we are required to get, etc. I don't want to go into a lot of detail on a public forum, but this last piece and at least one other along the way were things that from our understanding the buyer's agent probably should have been birddogging to make sure they happened as they were supposed to, that's all I'm saying.

It is difficult in this situation to keep from pointing fingers and laying blame, however, so perhaps I'm being too harsh.

And yes, the timeline requested by the buyer which we agreed to in an effort to accommodate their needs was very, very short, and as someone pointed out earlier, was about half the length of what is normal. I know that is part of the problem.

At any rate... yikes, I'll be glad when this is done.

Well, after 3 closing times set and canceled at the last minute, 2 contract extensions, dozens of phone calls and not a few tears, it appears the deal is disintegrating. Not completely dead yet, but definitely on life support. After all is said and done either way, I can feel free to post more detail, but suffice it to say, some of the parties involved appear to have been less than truthful about where things stood. Right now, about as discouraged and emotionally exhausted as I've ever been. I can only imagine how the buyer must feel as well.

A bunch of our stuff is now in storage in anticipation of moving, because we were moving to temporary quarters while we build. Including many of the "decor" items that dressed up the house for staging purposes. Plus, the storage is an added expense which we really weren't planning on without selling the house. So, not sure what to do about that now that it looks like we may be back to square one.

The saving grace is that our realtor absolutely insisted on negotiating a "possession after closing" into the contract, just in case, so that we would not move before closing and then be stuck.

I hate this.

Selling a house is emotionally exhausting, even when everything goes perfectly. I can only imagine how discouraged you must feel right now.

What a difference a day makes... they actually got it together and we closed late this afternoon.

Papers are signed, money was wired from lender to title company, title company wrote the checks - Only thing remaining is that even though the title company has the funds, they can't formally release them without a "funding number" that they were supposed to call the lender to get after signing everything. The lender apparently had some sort of telephone system malfunction late today (6pm CST when we were finishing up). So, that is supposed to happen first thing tomorrow, then we get the check and DONE.

TO DAVE DONHOFF - there's nothing left that can happen now, right? The lender has wired the money, this is just a technicality? Right? We've had our hopes dashed so many times in the last week I'm afraid to quite believe we really are just about finished.

t-mac-mo, it is now a done-deal. Congrats :-)

What a GOOD turn in events! I'm sure it will go good for you today!

Hi T-Mac-Moe,

TO DAVE DONHOFF - there's nothing left that can happen now, right? The lender has wired the money, this is just a technicality? Right? We've had our hopes dashed so many times in the last week I'm afraid to quite believe we really are just about finished.

[LEGALESE OBFUSCATION] Technically it's REALLY only a "done deal" when the funds are in your account, the transfer has been recorded, AND enough time has passed that "reasonable minds" (i.e. judges or juries) wouldn't allow an unwinding of the deal.

OK... IN REALITY... I would say it is safe to pull out the champagne... you're 99.9999999999% closed.

Congrats!!!
Dave Donhoff
Strategic Equity & Leverage Planner

Well, the funding number that was supposed to be just a formality turned out to be a little more than that. Apparently once the lender got the paperwork from the title company, they found something else they wanted to take a closer look at, putting the deal back through "due diligence." Buyer's agent not returning our agent's phone calls. Much freaking out on my part. Title company in shock, having never seen this happen. Finally at 4pm today, got the word all okay, check in hand, going to the bank first thing tomorrow.

Thus ends three of the most stressful weeks of my life.

Has anyone ever heard of anything like this?

Sorry your closing was so frustrating. I thought I had a doozer many years ago, without going into details, had both agents screaming at each other across the table, had the state and Fed IRSs fighting over the profits and us, the buyers, sitting there in shock. It all worked out, but as you said, the most emotional, stressful times. Congrats!

Hi t-mac-moe,

Has anyone ever heard of anything like this?

Wehhheelllp.... wish I could say "no"... but truth is stranger than fiction, and I've seen even wilder frustration pulled from the jaws of success...

You are FUNDED though.... bubbley time!!!
Dave Donhoff
Strategic Equity & Leverage Planner

Thanks, Dave and all. We are celebrating, though kind of too exhausted to make a good effort at it ;-) Very thankful to have it finished. Have a few follow-up questions to ask once the dust settles about some things that came out at the end about very questionable actions by the buyer's agent.

We move to our temporary rental on MOnday. We visited our build site today, where our builder has cleared, dug the basement, and graded the driveway, all this week while our little closing drama was going on. It reminded us why we're doing it - 13 acres and a lake, with a lovely little log cabin...ahhh! Makes me feel a little less like punching aforementioned buyer's agent in the nose ;-)

Pop...the sound of the bubbly.