Rick,

The buyer seemingly failed to be upright about his current status, number one. # 2, the lender/ underwriter should've caught this earlier. Hopefully it can be worked out and the deal closes.

I truly think you did due diligence. I think asking for current work permits would violate their rights. I think responsibility lies completely with the loan company / loan officer.  Don't you think when they put his package together this should have popped up? I wonder when the underwriter asked for a new permit? Did they really wait until the day before?

Sorry you are all in limbo. How frustrating.

Mott- I agree with you, "hard-working professionals" do "pushed up against the wall" - this guy is as legit as they get and this should not be happening to him.  You can imagine he has a attorney working diligently to get this solved.

Esko - (it's Ines...sorry that you did not know....Rick does not blog....yet).  According to the buyer, he was not aware that his green card had expired, his attorney had always been on top of it in the past and we believe him.  As for the lender and underwriter....they should have caught this weeks before.

Debi - thanks for you opinion, I also think asking for current work permits would be a violation of their rights.  The question is where do we cross the line?  Do we say "let me see your green-card?" - it's not easy.

Ines - Wow - how frustrating. We are exposed here too! Interesting to consider how to handle it. I'll be interested to see what others have to say too. 

..."was here on a worker's visa, and his green card had expired 1 month before... We had never encountered these types of problems with someone who had filled taxes, had a social security number and worked for a major corporation. You would also assume that a large corporation would not have employees that are not legal in the US."

Just a little clarification here. I'm not an expert by any means on various immigration statuses. However seems to me that this person was legally employed. You mention that you thought a large company would not have illegal employees. I may be misunderstanding, but sounds like the employee was legal. They had a work permit. They had a social security number and were paying their taxes. Companies all the time hire employees who are not citizens. I have worked with many people that are not citizens, but are legally employed.

As for how you avoid a situation like the one you are discussing, I am not really sure. I have never thought about that before.

Cyndee - let's hold on and see if anyone has suggestions.

Angie - The whole point is that the worker's permit had expired which technically makes him "illegal" and that's why the underwriter is having problems.  We have closed many deals with foreign nationals that don't even have worker's permits, we have also closed many deals with non-US citizens.  The whole problem is a technicality that should not have been overlooked and should be resolved quickly.

More things to watch out for! Our jobs expand & expand!!!!!!!!!!!!!!!!!!!!!

Ines, ok thanks for the clarification. I just read that wrong.

Randi - it never ends, no?

Angie - no problem - by no means did I want to insinuate that doing business with non-US citizens is not good practice - the total opposite, we deal with a lot of foreign nationals.

Hi Ines- wish I could say this doesn't hapen all the time, but it does.  The only way I know to avoid it is to ask any buyer to be prequalified by your trusted mortgage person as a condition to the contract.  It steps on some toes, but it does the job.  You can't really expect the buyer to know exactly what is needed - they are not experts.  We trust our business and our reputations to anyone that comes along... especially in Miami - this is a hazardous practice.  When you don't know who you are dealing with, we owe it to ourselves and our sellers to have an expert interview with someone you know and trust before taking the property off the market for 30-45 days only to watch the deal go down the tubes.  As Realtors, we don't have to know all of the questions, much less the answers, we just need to have a good team  of lenders, attornies, inspectors, etc. to help us along.  Only someone with mortgage experience would have known to ask for a copy of the work permit up front.  Hope this helps and I hope your deal closes.

I'm with you and Debi, you can't go around asking everybody for work permits. And what if you didn't ask just one person for theirs?

Beth- I totally see your point, but that scenario belongs in a peachy world where everything is perfect.  When customers start finding you on the Internet because they are educated consumers, they will usually come pre-qualified and ready to go with an offer.  You better believe we always try for buyers to be pre-qualified by our team, but it doesn't always go our way and the last thing you want to do in this market is loose a good, ready and willing buyer.

This gentleman's loan was being handled by a big local bank, not a little unknown mortgage broker.  In addition Rick is very good about managing the transaction and making sure everything is in place - now we'll know one more question to ask.  Thanks for the advice.

Dena - the problem here is that there were no red flags or no sirens going off to let us know something was wrong - this is purely a sign of bureaucracy at its best - this guy is a respectable citizen who abides by the law and pays taxes.....let's hope it's resolved quickly.

Wow. I can't believe, in this day and age, that someone would let their green card expire; especially when you may have trouble even getting another one.

Ines, in this cases it is easy to access who is at fault, it is the Lender/Loan Officer unless the Borrower lied to them, I will explain.  One of the questions on the forth page of the 1003 (Loan Application) the "Declaration Page" is are you a US Citizen, if "Yes" you move on it "No" the next question asks if they are a Permanent Resident Alien, If the answer is "Yes" then the Lender/Loan Officer needs to get a copy of the Resident Alien Card (Green Card) and check the expiration date on it.  If the card expires within the next 12 months then the Lender/Loan Officer needs to have the Borrower file an application to renew their card.  The process to renew a card takes time, but the Lender can accept a signed copy of the application that has been stamped as received and in process by the proper authorities.

So as you can see, if the Lender/Loan Officer had done their job, this would have been known at the time of application and could have been taken care of right away, that is unless the Borrower lied to them.  This is not uncommon and not a big deal as long as the Loan Officer asks all the questions on the 1003, and collects the proper documentation upfront as he is suppose to.  The only time that something like this should ever be a surprise is when the 1003 is first taken and the Borrower does not know that their card will expire within the next 12 months, but after that it should there is no excuse.

Well that's a bummer. Sounds like one of those things that slipped through the cracks. Hopefully they will be able to sort it out quickly so you can get this one closed. I agree with George that the LO probably dropped the ball on this one. I think for the REALTOR to ask for work visas is a little beyond our responsiblity. Heck we can't verify everything. Thats why LOs and title co.s get paid.

Why not add a clause on the Purchase Agreement ? Are you a U.S. Citizen ? Be consistent, so you don't violate Federal Housing Laws.

We have added to our contracts in Ann Arbor, MI, " Are you current on all your mortgages obligations? "

Too many foreclosures.

George - thanks for the explanation, I will have to check on that and make sure the LO did their job.  What's sad about this whole thing is that the buyer can loose in excess of $30,000 if the seller does not grant him an extension.

Bryant - I do think it is beyond our responsibility but at times we feel we babysit everyone around us from LO's to title companies and we try for our transactions to go as smooth as possible even if it means doing someone else's job.  But you are right...we cannot verify everything.  (btw, I was waiting for your opinion on this, you know I respect the way you do business).

Missy - I don't know if that would be consistent with Fed. Housing Laws, but I will certainly check with our company's legal dept.

Wow what a mess!  Expired green card is not a good thing. Especially today with all the heightened security. I feel for you Ines.

Must be a better word to use there than "foreigners".

Monika - this customer is as legit as it gets, but it is an important oversight.

Ardell - what's wrong with the word "foreigner"?  Do you have a better suggestion?  I'm a foreigner and don't see any negative connotations but now I am curious.

Rick, I am with Esko on this - the buyer must shoulder the bulk of the burden.  In fact, I am surprised that the buyer would not have disclosed that his green card was about to (or did expire).  No excuse whatsoever!  Paying taxes does not grant one any waiver from following INS rules.  We citizens show ID and non-citizens show  proof of permanent residency - simple and plain.  I agree the LO should have caught it sooner, but I'm not going to throw him/her under the bus.  

To answer your last two questions:

1.  No you shouldn't ask for work permit info because a work permit isn't a prerequisite for obtaining a loan.

2.  You should not feel guilty or responsible.  There are certain things that all people know, like brushing teeth in the morning, knowing our shirt sizes, knowing our residency status, etc.  

- Tchaka  

Tchaka (you should know by now that it's INES - Rick doesn't blog....but I forgive you). - I do feel somewhat responsible because the guy is goint to loose over $30K and the unit will go back on the market.  I know that before I became a Citizen my dad was on top of his green card like a hawk - it took a lot of time, money and effort to get it.

Hey Rick! living in Miami makes this stuff common. the guy was hiding it and very well knew it. by default, 4 out of 10 people in Miami know more visa law than lawyers. ask me something, i know it. 

if i was here on a permit, permiso por favor, expiring in a month! come on!! buyer fraud and LO slack. just ask George.

do we have to ask ""let me see your green-card?".. i wouldn't ask anyone, unless of course he didn't speak English.. then i would be so bold, to ask in Spanish.  it's a tough sitch to be in Finesse, hope they get that guy some kinda loan or time to hunt another buyer.

thanks for sharing the experience, i think it will help others in South Florida to be aware.

"oye, donde esta su tarjeta whey" is just not cool to say.

Slick Nick -are you talking to me?

What are you doing talking to Rick - what's wrong with you - show me your green card buddy!  : )

Dang, soon Miami will be like South Africa during apartheid!!!

Tchaka - that's a statement!

Is there a law regulating realtors as far as asking or having to find out a buyer's legal status in this country?  Thanks!

Gianni - although your question is very general, I will try to answer with different scenarios.  When a Realtor works with a buyer, they will usually pre-approve them and find out different relevant information in order to help them with their search - this is done in order not to waste either the costumer's or the Realtor's time.  Pre-approval may involve mortgage and legal status knowledge.

- in a place like Miami that is an International Hub - it's important to ask about Legal status because there will be different legal requirements necessary for the purchase or sale of a home.  One example is a federal government regulation that Realtors need to be aware of regarding the purchase of real property in the US by foreign sellers.  The IRS requires that buyers withhold 10% of the gross sale price.  The buyer then needs to report the purchase and pay the IRS the amount witheld - there are exception to the rule but Realtors should encourage buyers and sellers to consult the IRS or a tax specialist regarding the application of this rule.

I hope that answered your question.