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You want me to pull what off of the purchase agreement?

Just when you thought it was safe to go outside, in the proverbial sense, you are hit with something new. Purchase agreement is all initialed, dated and signed. The seller has agreed to include in the sale his riding lawnmower and a few other items. Then behold a call comes saying, sorry but that cannot be included in the purchase agreement. Needs to be off of there. Okay, so we are trying to do things above board and now this. Now you have to go back and explain this to your clients that this needs to be done over, and need to exclude the personal items. Now we need to do a separate bill of sale for these items. No explanation other than the underwriters do not want this.

Make sure it is in writing somewhere, if you are asked not to include this in the purchase agreement.

This is going on here in Iowa and is being perpetrated by a large bank. Is anyone having these issues where they are at?

Posted by Michele Ott on 06/25/2009 12:20 PM

Comments (8)

mortage, loan, iowa, real estate, sellers, buyers, personal property, bill of sale, purchase agreement

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8 Comments on You want me to pull what off of the purchase agreement?

JUN

Have not seen that requirement. Never know what will come from the lender. Did you ask then to make an exception for this case and allow the contract to stand as it is?

One of my preferred lenders said FANNIE MAE no longer will allow any "extra" items included in the sale, other then the standard appliances.

Thanks for the comments.

Roy - told it had to come off, period.

Michele

Personal Property is not Real Property therefore it can not be used as collateral for a real estate secured loan. This is a standard guideline in place to avoid valuation issues in the event that the personal property is of significant value (a care for example).

Sometimes you can get by with an addendum to the contract that states that the item in question has no value.

I meant a CAR. Sorry.

Thom, not talking about collateral. I know Personal Property is not Real Property.

On a "Purchase Agreement" there is an area that Realtors include any personal property that is staying and sometimes part of the negotiations. For instance, a sit down mower or a tractor. We understand that we are in the business of selling homes, not personal property. This (included propety) is usually included in the purcahse argeement, line 9, page 3 (here in Sioux City).

Michele

Michele,

The value of the mower may be enough to tip the scales with this particular lender. There seems to be lender judgment calls made regarding personal property values that can disrupt a transaction. This is the reason that I advise addressing personal property outside of escrow to avoid the disruption. Best of luck:)

We have seen this for several years here in Arionza. And yes it is true that it depends on the lender as to how strict they are about the writing of the personal property in the contract. The majority of the time it has to be on a seperate bill of sale. One way that we have found to get around this so that it still ties back to the contract is to use the BINSR. What I mean is that we write on the BINSR that the following list of personal property to be left in the home. That way the buyer gets the personal property or can cancel the contract based on the BINSR.

Hope this helps,

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