I had an interesting situation come up recently. A buyer had made a cash offer on a property owned by a quasi-government privately owned mortgage corporation. The offer was accepted, but the seller delayed in getting the executed contracts delivered.
And so the SELLER asked for an extension on the closing date to ensure enough time to get the title work done. The buyer agreed, the extension was executed, and then signed and stamped by all parties.
Here’s where the story gets interesting: On the day of closing, the buyer wires the money to the title company’s office. But after driving 50 miles, and after having done everything correctly, the buyer is told that the contract fell “out of the system,” and that the offer process would have to start all over again.
Of course I protested. I don’t care about this mysterious “system” and what’s in it and what is not. We had a perfectly good, legally binding contract already and I felt that it could compromise my client’s position to start over with a new contract.
The response I got was the typical” “Do you want to close or not?”
My client acquiesced, and we closed a week later. But the title company held all of the purchase money the whole time!
My client did not understand how he could have paid the money and not owned the house. He had worked hard all of his life and saved every penny to purchase a home for his family. He followed all of the rules. He didn’t try to “beat the system.”
Instead, the “system” beat him.
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Good morning Richard,
Ahhhhh...another mystery contract! Don't you love the answer you were given about it being a biding contract?? My way or the highway!
Maybe buyers should write in a "time is of the essence" clause like bank-owned properties do and charge $100 for each day it doesn't close. I bet they would close on time then.
Good Morning Richard,
Thanks for the post. Wow, you would think that this was a seller's market. Have a great day Richard, you deserve it.
I find it so frustrating that the "banks" can make all the rules along the way and the buyers have to just go along with it. I wrote a blog about this probably a year ago that there is no accountability on the seller side of the foreclosure transaction and nothing has changed. Glad your buyer got what he wanted in the end.
That is just all wrong. The playing field is not always equal.
Richard, while not exactly the same, we've had similar situations come up with banks, collection companies, etc. While legal action would be justified, it's probably going to be to expensive to be justified, but some well placed letters to the banking commissions and the government do wonders these days.
Sadly, this situation is not unique. I feel for your buyer and hope he didn't have too much additional expense (ie: moving truck, storage, rent, etc.) during this "mystery process".
It seems to be the banks way. They use their own listing agreements that agents, other than the listing agent never see. They have too many in house attorneys. Hopefully they will be out of the business eventually.
Unbelievable and unacceptable. If we did our business like that we would have no clients. Why is it that this sort of thing is allowed to go on?
Nothing is easy these days when dealing with banks or even quasi-government privately owned mortgage corporations...while what happened was frustrating and exasperating, my response is, thank heavens you closed a week later!
Funny how that works...the system.....
This is the sort of garbage that poisons the minds of the public against our industry.
and as my attorney says: " No one wants lawyers until you need one" Unfortunately, we need them to help protect us.
That is simply appalling! I suppose the bank knew they had the power and just did not care. They had the money...your buyer wanted the property...the person on the other end was making the same amount of pay whether you closed or not...a very sad situation indeed!
Fell out of the system, hmmm. Sounds to me like somebody screwed up. I wonder if he could find a lawyer to ask for some money back for expenses, etc. Probably not enough money to be made and most lawyers would not consider it worth the trouble.
Richard wait until they own and run healthcare. What happens if we fall out of the system when we need healthcare most?
I like Peggy's idea. What system were they using, Equator? "Do you want to close or not" iimplyingyou should be grateful you even had a closing is is appalling.
Richard...that is why we see so much black and blue colors at the closing table.
Grrrrr! I've been in your shoes. Laws and rules don't seem to apply to the banks; they call the shots, they make up the rules as they go along.