This month Patricia Feager and Kathleen Daniels are hosting the March challenge titled "March to a Solution | ActiveRain March 2023 Challenge" Patricia and Kathleen are asking us to share issues we have encountered during our professional career in Real Estate, which may help others to avoid and hopefully resolve.
I have read several excellent blogs submitted so far in this challenge by Realtors/Agents, however, as a Loan Originator my job is to help Borrowers obtain the financing they need to purchase a home. This involves:
- Qualify the Buyers/Borrowers for the price range they can purchase in.
- Provide a Pre-Approval Letter for Buyers/Borrowers to submit with their offer.
- Help Buyers secure financing for a mortgage loan once their offer has been accepted
- Advise Buyers/Borrowers through the mortgage loan process, and
- Follow the mortgage loan through loan commitment, and through the closing.
As a result I am not involved in what goes into a Buyer/Borrower finding a house to purchase, the negotiations, and interaction between Buyers and Sellers during the purchase process. However, what I do get to see is the stupid things Buyers and Sellers do which cause mortgage loans not to close. In my first blog in this challenge, "Easy-Peasy, Wrong!!!" I gave an example of how a Buyer/Borrower can make the loan process difficult, and sometimes even fail because of stupid thins they do. In this second submission for this challenge I will give three examples of stupid things Sellers do that cause my Borrowers to walk away from the property.
There are two major things I see Borrowers walking away from a property are for. First and foremost is Sellers refusing to negotiating repairs which are identified by Appraisers and Home Inspectors. When a Seller takes a hard nose attitude of "I am not bugging", the Borrower more often than not walks away from the purchase. Many times the purchase blows up because of ridiculous little things, the Seller is unreasonable about. This is not to say that Buyers is not equally unreasonable as well at times.
The other most common cause I have seen which causes a Borrower to walk away from a purchase is actually things which are discovered during the final walk through just before the Closing. For whatever reason Sellers seem to think they can hide damage to a property and get away with it. Some how they think the Buyer will not walk away from the purchase the day of the Closing. Let me give three quick examples:
- On the final walk through a huge urine stain was discovered on a hardwood floor which the Seller had covered up with a large rug. The stain was so bad that a large section of the floor needed to be replace. It was to late to fix the floor before the closing, and the Seller refused to provide funds to fix the damage after the closing. As a result the Buyer walked at the closing Table.
- Another was a Seller while moving their furniture out of the house, dragged the furniture across the hardwood floors causing deep gouges through out the hardwood floors in the house. In this case the Buyers didn't even go to the closing and try to negotiate a remedy, they walked away right there and then. Found another house a week later they actually liked better, and we closed a few weeks later.
- The third example of stupid a stupid thing a Seller did, however, in this case the loan still closed, was a young Seller who loved her outlet and switch covers. This young lady thought it was OK to remove all the outlet and switch covers just before the final walk through. In this case the Buyer did not care for the outlet and switch covers she had so the loan still closed when the Seller agree to give a small closing cost credit for the Buyer to purchase new outlet and switch covers.
These are just three examples, I could provide more, but I think these two make my point of Stupid Things Sellers Do That Cause Mortgage Loans To Fall Apart. The lesson that should be learned here is for Sellers to not try to be sneaky. Be upfront and above board. Being sneaky creates bad feelings, and blows up transactions. If everything is above board, no matter the issue, a solution can be found, but when one of the parties to a transaction tries to pull the wool over the others eyes, and creates mistrust, makes reaching a solution very unlikely.
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