loan commitment

Four Must-Look-Out Seller Contract Deadlines

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Among other terms, below are 4 primary contract contingencies established between you and the other party to look out for.

Cash or Financed Transactions

  • Inspection: Upon completion of property inspections within inspection period established between seller and buyer, buyer may withdraw/renegotiate their offer based on inspection findings without risk of losing escrow.
  • Clean Title: This is a seller contingency. So as long as seller provides clean and marketable title, buyer cannot utilize this contingency to withdraw/renegotiate their offer based on title findings without risk of losing escrow.

Financed Transaction Only

  • Appraisal: Upon completion of appraisal within appraisal period established between seller and buyer, buyer may withdraw/renegotiate their offer should appraisal value come in below purchase price without risk of losing escrow.
  • Letter of Commitment (LOC) or Loan Guarantee: Buyer must provide LOC to seller within LOC period established between seller and buyer in order to withdraw/renegotiate their offer based on buyer’s lender’s ability to guarantee the loan without risk of losing escrow.

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How To Loose Your Escrow 101

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It’s so much simpler than you think! Scary isn’t it?

I’ll write this post from a buyer’s perspective. To be more precise, am writing this post due to a recent closing where I represented the buyer for a home located at Encore / Panache, a community in West Kendall. And NO…my buyer did not loose his deposit. We closed…yeeeah!

So get ready. Any sellers reading this post? Smile…heck…you’re the one that stands to get the money 🙂

The possibility of loosing your good faith deposit when buying a home is tied up to several financing contingencies. But none of them are as important as the letter of commitment contingency (LOC). And the date when you are to provide this LOC to the seller is determined during contract negotiations.

This date should be as important as your wedding anniversary (or divorced date) or your child’s birth. YES…it’s that important considering deposits range in the thousands of dollars.

The obvious reason is because you forgot the date or didn’t even know you had to provide this letter.

WRONG! There is only ONE way to loose your deposit. And the answer is: your real estate agent and mortgage broker f##ked up. Pardon my language, but am very “passionate” about this type of negligence.

Simply put. During contract negotiations…it is when this LOC date is established. Who writes the contract? Your real estate agent. Once you have an executed contract, it gets delivered to your lender to start financing process. Who’s in between you and your lender? The mortgage broker.

So what’s the moral of the story here? Always inquire about the safety of your deposit. And keep asking verbally and in writing until the deal closes. During the purchase process, there are too many balls you have to juggle to be on top of everything. And you should not have to.

When To Dump Your Lender

Mario AvalosLeave a comment

When To Dump Your Lender? Or why would you?

If you are buying a home through financing, the process of asking and getting documents between each other (you and the lender) must be like syrup and pancakes: amazing! (noticed am a fan of pancakes with syrup?). SO…what does that mean?

Simple things like getting the application out of the way within 48 hours from the moment you enter contract with a seller. And ordering the appraisal within 24 hours after completion of application. And these are just a few examples.

If your lender drags their feet on the above, DUMP THEM. If within the first 72 hours, your lender has not pro-actively gone after you for the application and fee in order to get the appraisal going…DUMP THEM. It’s that simple.

Why? The hurdles involved in financing a deal can be complicated not just because of what the lender may demand from you the buyer, but what they may ask from the seller. If the lender is not on “the ball” from the get go…95% for sure that you will not meet the deadline to provide seller loan commitment (or LOC) and or not close on time.

And that is no light issue as your good faith deposit may be at stake.

The average financing transaction takes about 30 to 45 to close. And trust me…you will need every single day at your disposal. And the truth of the matter is that 30 days is just about the right amount of time needed to close a deal so as long as your loan representative is not only competent, but is also able to push the right buttons on the lender’s back end to make the deal run smoothly.

What about forty-five days to close? I would dare to say that 45 days is way too long to close a deal…but it’s not outside reasonableness.

As a matter of fact, within the first 15 to 20 days, you should know if you will be closing on day 30 or 45…whichever you and the seller agreed. UNLESS…there are title issues…but that is a seller problem…not a buyer’s problem.