It's All In the Details

Sipping a hot cup of coffee, I sit in front of my keyboard, contemplating the events of the last couple of weeks. The final stretch on a couple of pending transactions. One a short sale that has taken 8 months from the time I took the listing to hopefully the time it closes. The other is a 1st time home buyer who is purchasing a total rehab in a townhome community.

The short sale offer was a 2nd offer that was substituted after getting final approval letter from the 1st lien holder. I thought my problems would be with getting the 1st lien holder to allow an additional 1K to the 2nd lien holder and convince the sellers to take out a small promissory note for the last small amount. Hurdle was accomplished...all parties happy. The offer came from an agent with a well known franchise - approved price met, terms better than original, mortgage commitment date in line, closing date perfect.

No reason for me to worry - the offer looked great, conversation with buyer's agent reassured me that the buyer had excellent financials and the loan officer told seller's attorney it was a "slam dunk".

So, why am I sitting here wondering if we will close next week? Well, the loan product has been switched, extensions have been granted on mortgage commitment and closing and we are now out of the original closing authorization back to requesting an extension from the 1st lien holder to close a week later. Oh, and did I mention that the agent from that well-known franchise will not answer my emails nor my calls???? Does he know something he/she is not sharing? Unable to admit that his small delay in vetting out the loan company, his client before writing up the offer may have caused some of these issues??

Now back to my regular market listing...and the small details that might cause a delay. This was my first referral from a loan officer. A couple who are wonderful 1st time home buyers. I instantly bonded with them. They knew exactly what they wanted; financing was taken care of since the loan officer already knew he could make the loan as soon as they found a house to meet the criteria.

After less than 4 weekends of showing homes we found the perfect home. A total rehab, in their price range, approved by mother with an accepted offer from the sellers. So, why would I worry?

Put call in to loan officer on Friday to find out if we had mortgage commitment....well maybe....it seems like the earnest money check has not cleared the buyer's account and one of the conditions is to have a copy of the cleared check for underwriting to get the famous "clear to close".

So how could this small detail happen? Earnest money check was overnighted to seller's attorney since I don't hold earnest money at my company at the beginning of the transaction over 3 weeks ago. Now we realtors know that here in my state we only have a set amount of time to deposit the earnest money check into our escrow account. Checks in this day and age clear within a day or two at most for local checks.

So why did it not clear?? It appears that the attorney had not deposited the check! Why is still a mystery...will it now clear fast enough for the lender to give the "clear to close" in time for Friday's closing?

Lesson learned - always find out from buyers if their check cleared 5 days after being issued. You would think that a lawyer who is doing real estate would understand the importance of that earnest money check to a buyer's getting their mortgage loan? One would think that except this lawyer obviously was not thinking.

So, here I sit, hoping that these small details will be worked out in the end. Will we get the extension from the investors for the short sale? Will the check clear the buyer's account fast enough to give underwriting the copy of the cancelled check? Will I get paid on Friday???

Will these transactions close and make all parties happy in the long run....sellers, buyers, loan officers, lenders, investors, realtors and add a couple of slash marks to the plus side of the housing market crisis.

As the saying goes....the Devil is in the details.