I've had to learn some things in life the hard way, just hoping my little bit of knowledge and experience can help others.
* The name of the buyer in this article has been changed for their privacy.
Buying a home is one of the biggest financial decisions many people make, and the same could be said for selling a home as well. With this being our third home, we went into this sale thinking we were pretty knowledgeable and covered our bases pretty well prior to contacting our favorite real estate agent; the house had a fresh coat of paint inside and out, new ceramic tile was laid in all of the wet and high traffic areas, the landscaping was manicured, and we were aware of some small repairs that we couldn't do ourselves and were prepared to pay a professional to fix them at the potential buyer's request.
Because we had already purchased a new home, the home being sold was vacant and ready to hit the market. Everything started off great; our Realtor scheduled to have a professional photographer come take photos of the home for the listing once we were all moved out and the carpets were cleaned. Every agent who previewed the home prior to it being officially listed said the price was right and the home was in excellent condition, it should sell fast, and for the current market, "fast" meant about a week. Our hopes were high—keep in mind that we had already purchased another home, so the faster this one sold, the better.
On November 24th, our home was officially on the market—just in time for the holidays when nobody wants to go house hunting. And, on the market is where our home sat, week after week, open house after open house, with no viewings. Our Realtor was a bulldog, though. She went out of her way to get our listing in front of as many other agents as she could and took out ads in print and online. Finally, after three weeks and not a single showing, we lowered the listing price by $4000.
The Offer and the Counter Offer
On December 20th we finally had an offer. It was low, laughably low, nearly $30,000 less than our listing price. I had been following the market in our area for almost a year in anticipation of this move and I knew what this home was worth, so, we countered with a price just $2000 less than the asking price. To our amazement, and relief, they accepted our counter-offer and on December 22nd, twenty-eight days after listing, we were officially under contract.
Inspection and Appraisal
Now, all of the behind-the-scenes stuff started to happen. I scheduled the inspection immediately and had the report in my hand on December 29th. Because I was so meticulous about getting the home ready beforehand, there wasn't anything in the report that I wasn't prepared for or wasn't willing to take care of at the buyer's request, and on January 2nd the requested repairs were done and we moved on to the appraisal.
A text from my Realtor told me that our closing date was finally set for February 1st. With most home sales, closings occur within thirty days of the date the offer is accepted, so I was a little put off that our closing was an additional eleven days, not too horrible, but I had been paying for two homes and was ready to close as soon as possible. But, it was out of my hands and I had to just accept it and wait.
The Glitch and Extension
On January 24th my Realtor called with news that there was a "glitch" with our appraisal paperwork and it was nowhere to be found. We were eight days until the scheduled closing and they lost the appraisal paperwork.
One stress-filled day later, the paperwork was found and filed, we were back on track, or so we thought.
January 28th, the day before we were set to close, I got another call from my Realtor: they needed an extension for the closing date. Excuse me? Apparently, Jane, the buyer, hadn't filed taxes for her business for the past two years. The bank was now refusing to lend them the money until this was taken care of. How was this going to affect their credit rating? Were they still going to qualify for their loan? And how in the world did the lending agent miss something as crucial as that?
So, who do I blame for this? The buyer for not filing her taxes or the lending agent for not doing his job and not uncovering this fact earlier? I chose both. To put things into a timeline perspective for this issue, when we were buying the new home, our lending agent asked for tax records for the previous two years on the very same day that I contacted her about a new mortgage—that very same day, not the day before closing.
In response to the extension, our Realtor drew up a cure notice, a legal way for us to end our contract with the buyers if needed, stating that the buyers had to pay an additional $2000 in non-refundable earnest money and if we didn't close by the new date of February 28th, sixty-eight days after we went under contract, we were ending the contract and keeping all earnest money paid to date.
At this point, I was stressed out and I started looking around for other options. I contacted Open Door and Offerpad because of their ability to close in as little as a week. Both, unfortunately, sent over offers that would net us thousands less than we were going to get from our current contract, even when factoring in the monthly cost of keeping all of the utilities on in a completely empty home. So, we had to wait and cross our fingers that this was the last of the issues.
On February 8th the buyer filed her missing taxes and we were back on track. Until February 15th when my Realtor, having not received any updates from the lender or buyers agent, called around and found out that there was no record of the buyer's tax returns being filed with the IRS. She contacted the buyer's Realtor and he assured her that the taxes were done but had no explanation as to why the IRS had no record of them.
On February 21st, one week before our second attempt at closing this sale, there was still no record of the business tax return being done and filed with the IRS. My Realtor started calling the local IRS offices, trying to hunt down the paperwork. Finally, one of the returns was found, but still no trace of the second. Without these returns, the lender would not give out a loan and our sale would fall through. We were already sixty-one days into this contract and all I wanted to do was close the deal and move on.
Finally, on February 23rd, the second tax document finally showed up as filed with the IRS. Unfortunately, this was too late for all of the other paperwork to be finished and filed in time for the 28th closing date. So, we were faced with another dilemma, do we do yet another extension or do we cut these buyers and move on. Sixty-eight days under contract for a home that was neither a foreclosure or short-sale, is absurd. But unfortunately, the market hadn't picked up much after the holidays and there wasn't much hope of getting under contract with another buyer anytime soon. So, reluctantly, we did another extension with a third close date of March 6th. This time my Realtor drew up another cure notice and added $75 per day charge for every day past the February 28th date that we don't close, just in case anything else was to come up and to help cover the cost of the utilities we were still paying for the home.
All of the paperwork was finally sent to the underwriter and the loan documents were underway.
March 5th, one day before our third attempt to close this sale, I got a notice that after Jane filed the missing tax returns for her business, her credit score dropped to a point where she no longer qualified for the mortgage loan and we would not be able to close on time, again. Of course.
On March 6th, with my fingers crossed, I contacted Open Door once again. They had the higher of the two offers before and with the non-refundable earnest money from the current buyers that we would keep after canceling our contract with them, and the offer price they gave us before, we would basically break even if we canceled the current contract and accepted the Open Door offer. Unfortunately, the new offer from Open Door dropped significantly from the first time around because of the current lull in the market, and our loss would be financially devastating, so we decided to stick it out with the current buyers and hope that they could magically find a way to increase her credit score to, once again, qualify for their mortgage loan.
March 8th and we were sitting in limbo with no new closing date set. My Realtor was pulling her hair out. The lending bank was waiting for notification that the buyer was in qualifying range for their loan. I was out of patience and out of ideas. I finally told my Realtor I was done with these buyers. I wanted to cancel the contract and move on, waiting for another buyer to come along would be less stressful than encountering another issue with this buyer. She agreed and sent notice to the buyer's agent that if the credit score issue was not fixed by 5 pm that day, we were canceling the contract for good.
At 4:59 pm, the buyer's agent called my Realtor to let her know the buyers, miraculously, qualified for their loan and we were "back on track". Needless to say, I was not so sure of that.
On March 9th a mobile notary was scheduled to come to my home so I could sign all of the closing documents. Because my husband was working out of town, a mobile notary was contacted to go to him for his signature. Unfortunately, the documents had to be in the FedEx dropbox no later than 10 am on March 10th, and the only mobile notary available in the area wasn't able to get to him until 10:30 on the 10th. My Realtor, once she heard about this, jumped on the phone and called the closest notary office, explained our situation and was able to get a notary to my husband's location in time for him to sign all of the documents and get to the dropbox in time. I later found out that she paid an extra fee for this out of her own pocket.
With all of our documents signed and delivered, it was now down to the buyer's signing on their end and we could finally close. They were scheduled to sign all of their documents on March 12th at 10 am and delivered by 1 pm. When the buyers showed up to the notary's office, the notary noticed that Jane's driver's license was expired. Because this was the only form of ID that she had, and an up-to-date form of ID was required, her signature would be null and void.
Now, if you've ever been to a DMV in a larger city, you know that lines can be long and the wait time can literally be hours. They were racing against the clock to get her driver's license renewed and back to the notary for signatures to meet the 1 pm deadline.
Finally, after eighty days under contract and a whole host of issues that I never could have imagined, we finally closed on the sale of our home and vowed to never look back, until I decided to document it for this article.
This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.
© 2019 camarochix72