Buyers may not be able to get mortgage

[1imbo]

What is the name of your state?What is the name of your state? California

The Residential Purchase Agreeement was signed Oct 9th.
Buyers signed a form removing any and all buyers contigencies on Nov 11th.
Close of escrow is set for Dec 9th.

We heard recently that the buyers mortgage application was rejected. They will re-submit to another lender soon. We were told that the buyers will not be able to complete on the scheduled close of escrow date, Dec 9th., which is next week.

We have already paid a deposit for a rental apartment. We have packed and sent change of address form to the post office, etc. We are ready to move out by the 9th.

What can we do?
1) Let the 9th pass and we serve the buyers a Notice to Perform. The buyers paid a $1000 deposit to the escrow company. It isn't much as it was all that they could afford. (We didn't have any other offers to buy our house, so we were not in a position to choose other buyers) What happens after serving the Notice? Our realtor isn't very informative.

2) Extend the close of escrow date by another 2 weeks. The difficulty with this option is that we lose the rental apartment and the deposit for the apartment. It isn't easy for us to find another apartment in such a time frame due to the festive season and we already have travel plans. We also have a nagging worry that the buyers will not get the mortgage at all, even after 2 more weeks.

[Ithildriel]

I am currently in a similar situation, except that it is an estate sale, so I do not have your added burden of not knowing whether or not I have a place to live. I am also in CA by the way.

I am not a RE agent, or attorney, but my escrow was scheduled to close yesterday, so first thing this morning my RE Agent sent over to the buyers a "Demand to Close Escrow. The form says they have 3 days or whatever number you put in. So you don't have to give them more than 3 days, but my agent said in an e-mail to me

"My broker says that the CA dept of Real Estate and the court are recommending that the demand to close escrow be given the full seven days. "

My understanding is if all contingencies have been removed, etc, my RE agent said that they would be responsible for liquidated damages up to 3% of the purchase price if they do not complete the sale. Liquidated damages could possibly be loss of the deposit for the apartment that you now don't need because they didn't fullfill their part of the contract. This of course would most likely have to be decided by a judge in small claims court.

Again, I am not an attorney. If your agent is not being clear with you on what needs to be done, you may want to ask if you could speak with their broker. Another option of course, is to try and get a free consult with a real estate attorney. That's what I will be doing if the buyers don't complete this transaction by next week.

[HomeGuru]

Originally Posted by 1imbo

What is the name of your state?What is the name of your state? California

The Residential Purchase Agreeement was signed Oct 9th.
Buyers signed a form removing any and all buyers contigencies on Nov 11th.
Close of escrow is set for Dec 9th.

We heard recently that the buyers mortgage application was rejected. They will re-submit to another lender soon. We were told that the buyers will not be able to complete on the scheduled close of escrow date, Dec 9th., which is next week.

We have already paid a deposit for a rental apartment. We have packed and sent change of address form to the post office, etc. We are ready to move out by the 9th.

What can we do?
1) Let the 9th pass and we serve the buyers a Notice to Perform. The buyers paid a $1000 deposit to the escrow company. It isn't much as it was all that they could afford. (We didn't have any other offers to buy our house, so we were not in a position to choose other buyers) What happens after serving the Notice? Our realtor isn't very informative.

2) Extend the close of escrow date by another 2 weeks. The difficulty with this option is that we lose the rental apartment and the deposit for the apartment. It isn't easy for us to find another apartment in such a time frame due to the festive season and we already have travel plans. We also have a nagging worry that the buyers will not get the mortgage at all, even after 2 more weeks.

**A: you answered your own question.

[1imbo]

California County: Alameda
I spoke to our realtor earlier today. I am not very confident of him. I would appreciate if someone could explain the next-steps to me. Questions:

1) Our realtor said that we can fill out and sign a Cancellation Form and send it to the escrow company. Is he correct on procedure?

2) Has our realtor mistaken the Cancellation Form for the Notice to Perform/Demand to Close Escrow?

3) If we should send the Notice to Perform/Demand to Close Escrow, when can we send this document and to whom?

Thanks for you help.

[Ithildriel]

Originally Posted by 1imbo

California County: Alameda
I spoke to our realtor earlier today. I am not very confident of him. I would appreciate if someone could explain the next-steps to me. Questions:

1) Our realtor said that we can fill out and sign a Cancellation Form and send it to the escrow company. Is he correct on procedure?

2) Has our realtor mistaken the Cancellation Form for the Notice to Perform/Demand to Close Escrow?

3) If we should send the Notice to Perform/Demand to Close Escrow, when can we send this document and to whom?

Thanks for you help.

If your not confident in your realtor, I would ask to speak to the broker directly.

In my case the realtor was conveying me messages from the broker, so I finally went direct to the source. Too much can get confused in the translation.

[HomeGuru]

good advice**************...