Rate lock expires and seller don't want to close before that

[kperera]

I'm trying to purchase a home in New York city and rate lock about to expire on December 4th but the seller needs to close on December 9th but no guarantee.

My mortgage company wants me to pay a rate lock extension fee to have the rate because of the delay. I talked to my lawyer and he mentions he could not do anything about it and we need to pay all the rate lock fees even though they don't want to close also they could wait 45 days if they want. I feel it not fair to pay extension fees because of their delay.

In summary:

• Purchase a home in New York Richmond county (New York city)
• Closing date as per contract: on or about 11/18/2019
• Mortgage approved on 11/1/2019
• Rate lock expires on 12/4/2019

All your advices greatly appreciated!

 

[Zigner]

I'm trying to purchase a home in New York city and rate lock about to expire on December 4th but the seller needs to close on December 9th but no guarantee.

My mortgage company wants me to pay a rate lock extension fee to have the rate because of the delay. I talked to my lawyer and he mentions he could not do anything about it and we need to pay all the rate lock fees even though they don't want to close also they could wait 45 days if they want. I feel it not fair to pay extension fees because of their delay.

In summary:

• Purchase a home in New York Richmond county (New York city)
• Closing date as per contract: on or about 11/18/2019
• Mortgage approved on 11/1/2019
• Rate lock expires on 12/4/2019

All your advices greatly appreciated!

My advice is to listen to your attorney.

 

[kperera]

My advice is to listen to your attorney.

Appreciate if you could explain because I learned from one of my friends that he got claimed those fees from the seller.

 

[Zigner]

Appreciate if you could explain because I learned from one of my friends that he got claimed those fees from the seller.

You have an attorney advising you on this matter. You should speak to your attorney about this matter. It would be irresponsible for us to give advice, as we are random internet strangers with no knowledge of your specific deal.

If you still want to hear more: I would suggest that you pay it if you wish to maintain the interest rate you have locked in. You may be able to negotiate something with the seller to compensate you for the fee - but you'll want to ask your attorney about that.

 

[LdiJ]

I'm trying to purchase a home in New York city and rate lock about to expire on December 4th but the seller needs to close on December 9th but no guarantee.

My mortgage company wants me to pay a rate lock extension fee to have the rate because of the delay. I talked to my lawyer and he mentions he could not do anything about it and we need to pay all the rate lock fees even though they don't want to close also they could wait 45 days if they want. I feel it not fair to pay extension fees because of their delay.

In summary:

• Purchase a home in New York Richmond county (New York city)
• Closing date as per contract: on or about 11/18/2019
• Mortgage approved on 11/1/2019
• Rate lock expires on 12/4/2019

All your advices greatly appreciated!

Any chance that they don't want to close because they cannot be out of the home by December 4th? If that is the case, then maybe they would be willing to close on the 4th anyway, as long as you give them extra time to get out of the house. When I bought my current home, the prior owners needed an extra 30 days to get out of the house. We closed anyway, and the sellers paid me 30 days rent to remain in the home for the extra 30 days they needed. Something like that might be an option if NY law allows for that.

 

[kperera]

Any chance that they don't want to close because they cannot be out of the home by December 4th? If that is the case, then maybe they would be willing to close on the 4th anyway, as long as you give them extra time to get out of the house. When I bought my current home, the prior owners needed an extra 30 days to get out of the house. We closed anyway, and the sellers paid me 30 days rent to remain in the home for the extra 30 days they needed. Something like that might be an option if NY law allows for that.

Wow! This seems like a good option and this is going to be useful because we have noticed they are not ready to move out and many people still live there. Just curious, rent is something we could decide or they decide what are they going to pay during the time they going to stay?

My lawyer was telling their lawyer is in the hospital to get some treatments done and he getting discharge on or before 9th. That is the reason they don't want to close.

 

[adjusterjack]

Renting out your house to the seller after the close of escrow is an incredibly stupid idea. They'll be sitting with hundreds of thousands of dollars of your money and all you'll have is a house full of TENANTS. And what happens after a month and they still can't move out? You end up spending more of your money on your lawyer and court to evict them while they are sitting with hundreds of thousands of dollars of your money and doing who knows what to your house.

What you should have done on 11/18, when it was clear that they weren't closing, was to either cancel the contract due to breach and walk away or demand a fee for extending the close to a specific date, payment up front, in writing, signed by both parties, so if they did it again you would have another opportunity to cancel or collect an additional fee.

 

[TigerD]

Renting out your house to the seller after the close of escrow is an incredibly stupid idea. They'll be sitting with hundreds of thousands of dollars of your money and all you'll have is a house full of TENANTS. And what happens after a month and they still can't move out? You end up spending more of your money on your lawyer and court to evict them while they are sitting with hundreds of thousands of dollars of your money and doing who knows what to your house.

What you should have done on 11/18, when it was clear that they weren't closing, was to either cancel the contract due to breach and walk away or demand a fee for extending the close to a specific date, payment up front, in writing, signed by both parties, so if they did it again you would have another opportunity to cancel or collect an additional fee.

Quoted because I couldn't like it twice.

 

[STEPHAN]

Close earlier, allow the seller to stay, but hold 10K in escrow until they move out.

 

[adjusterjack]

Close earlier, allow the seller to stay, but hold 10K in escrow until they move out.

Nah. I still don't like closing and having the seller sitting there with hundreds of thousands of my money, even against $10,000.

Extending the close and holding on to my money gives me a lot more leverage.