Posted by Rich-CA on February 28, 2009 at 10:04:45:
It depends on the laws of the state and the terms of the contract. This is why its time for a lawyer.
Escrow question - Posted by Kat
Posted by Kat on February 27, 2009 at 17:02:19:
Was in contract for a REO condo in Florida. The bank we were getting our mortgage from ceased doing condo loans/we were informed 2 days prior to closing. The listing agent and asset manager for the property offered to extend the closing however were going to charge $100 per diem per day till closed. Then decided they did not want to do this and changed it to either we close 7 days later (27th of the month) or we are out of contract and they keep the escrow (buyer’s fault). They re-listed the property on the 24th of the month and then reduced listing price on the 25th while we are still in contract (extension via email). We submitted a new “Cash” offer to meet with the reduced listing on the 27th and we were told they already have an offer being entertained but not under contract. They have been giving us trouble since our first offer. Is there anything we can do? Can we at least get back our escrow? Any help much appreciated.
Re: Escrow question - Posted by Rose
Posted by Rose on February 28, 2009 at 07:30:33:
Fannie Mae and Freddie Mac’s new underwriting guidelines that restrict credit to condo projects that have a 15% delinquency rate, may have been the issue. In other words, if a condo building has more than 15% of the housing units delinquent on the “Home Ownership Association” or condo fees, then Fannie Mae or Freddie Mac will not supply any financing to buyers of units in the condo building. As they say, cash is king.
Re: Escrow question - Posted by River City
Posted by River City on February 28, 2009 at 05:36:09:
Couple questions… had your original contract already expired? Was there a written extension? Did you have written approval from your mortgage company before they decided they were no longer doing condo loans? Why didn’t you try to obtain a loan from the company that was holding the REO?
I know I have been through the mill with buyers supposedly being approved, but never seen a written approval. On one occasion, we had closing dates set up five times. We decided on the fifth time just to say forget it and find another buyer.
I hate to say this, but I believe there is more to this story than already said.
Its lawyer time - Posted by Rich-CA
Posted by Rich-CA on February 27, 2009 at 18:02:51:
Sometime a letter from an attorney will get them to understand you’re not just going to let them walk away with your money all because they are a great big company.
Re: Escrow question - Posted by kat
Posted by kat on February 28, 2009 at 09:17:00:
Thanks for your reply; however, that is not our question. We are not asking why the bank stopped processing condo loans, but what will happen with our escrow and what can we do about it.
Re: Escrow question - Posted by Kat
Posted by Kat on February 28, 2009 at 05:59:21:
Hi, The original contract expired on the 24th with an Email stating they would give us to the 27th.
We were going through a mortgage broker(never again) and had been pre-approved(in writing) before they decided to stop doing condo loans(as per the broker). the day we found out, the broker found another bank and we got a commitment letter(request of the seller) that was sent to the selling agent. the issue with the new bank is that they could not close until 3/14(maybe earlier) and the seller would not extend the closing date. On the 27th we submitted an all cash offer with proof of funds but was told they already received another offer(but not under contract as of yet). We have have done everything the seller has asked us to do but I believe the selling agent wants us to fail so she can bring in her own buyer(double the commission)
I’ve heard bad things about EMC’s customer service and this just confirms it.
Re: Its lawyer time - Posted by kat
Posted by kat on February 27, 2009 at 20:13:26:
We were thinking of getting a lawyer/attorney involved. We know ethically they are wrong; however, legally are they?
Re: Escrow question - Posted by River City
Posted by River City on March 01, 2009 at 16:08:32:
Did you ever receive a denial letter from either your broker or the bank? They are required by ECOA (Equal Credit Opportunity Act) to provide a written notice of a denial. You were denied the loan because they decided not to do condo loans. It depends on their agreement with the broker as to who the denial letter would come from. Generally, an investor (the bank) has an agreement that the broker would prepare and deliver the denial letter. One other question, how long was your “pre-approval” (prequalification?) good for? It should have an expiration date on it. If you were actually “pre-approved” and not “prequalified” subject to other verification conditions, and the pre-approval has not expired, you might could force the bank to close the loan, as they are bound by their agreement of the pre-approval.