Closing Question

Hey, just wanted to know how we should handle the current situation.

My fiance and I are on the verge of getting our first house, and the seller has asked for an extension twice (which fell under the contract terms of on or around Aug 15), leaving us with a closing date of Aug 10.

I find out today from the seller that his attorney will be on vacation from Aug 10-14, and wouldnt be able to close until the 17th. The attorney also failed to respond to our broker's e-mail from 2 weeks ago stating the Aug 10 closing. Our interest rate lock expires the 13th, so we would have to pay money to keep it. Needless to say, we are ****** that this is happening, and feel that we shouldn't pay a dime to keep our rate.

In any case, I'm curious what leverage we have over the situation? Since the contract reaches the end on the 15th, the seller would need to request more time from us. If we say we want to close on the originally determined date, what's to say the seller won't just refuse to do anything unless we move it to the 17th and us footing the bill for the extension?

Re: Closing Question

You certainly should not pay to extend your rate. Either you let them know that they will be responsible for that fee or the deal is dead.
Tell them if you don't close by then, the deal is dead and you're walking away. Either they close by that date or THEY pay your fee to extend the rate.
Believe me, their lawyer can VERY easily have someone else from his office to fill in for him if they want the deal done!

We had a rate-lock situation and we actually were VERY lucky to be able to have it written in our contract that we MUST close by our rate-lock date or the deal is dead. 99.9% of lawyers will never let their clients agree to this and sign a contract with this, but our sellers were very accomodating!!

Good luck to you, let me know if you have any other questions!

Re: Closing Question

If your contract says "on or about August 15", you have up until September 15 to actually close and still be within the terms of your contract.

In this market you can try playing hardball with the seller and asking them to pay for the rate extension. You might get lucky, as I am sure the seller does not want to start over.

But legally, the seller is well within his rights to close on August 17 if your executed contract says "on or about August 15".

Re: Closing Question

Re: Closing Question

Your lawyer should be able to get the seller to pay the full amount to extend your lock in if they go past the 15th. The seller would be in breach of contract if they don't close by August 15, they should also have to pay you a fee for staying those two days.
Our seller agreed to pay half our extension rate, but it was a very complicated situation for us.

Re: Closing Question

Message edited 8/1/2009 8:47:01 AM.

Re: Closing Question

Re: Closing Question

You need to read your specific contract about what happens if the seller stays past closing. Normally they pay the mortgage interest & taxes the first few days and at some point (our contract said 5 days) they have to pay you a "rent" plus interest and taxes. Just make sure your attorney keeps money in escrow, in case something happens between the closing and you actually moving in. In your case, with your rate expiring, this might be a viable option for you if the seller won't pay for the extension.

Just to share the misery - we closed last year on July 3rd. Super excited because we had the long weekend to move and get everything set. Got a phone call on July 2nd at 10pm that the sellers were not moving out until at least the 7th. Needless to say, we were livid. We ended up getting a few hundred for our troubles, which was nice!

Re: Closing Question

Could it be arranged that you can close before the attorney goes on vacation? I don't have a calendar in front of me to see what day of the week that falls under but maybe you are able to close the day before. Considering you have been more than understanding by pushing the dates twice, if you were to incur any charges, I'd say the seller would need to be responsible and considering as well that you have both signed a contract. You have a lawyer and paying him/her a fee. He/She should be handling this to your best interest so get him/her involved so that your closing happens to the best interest of all parties involved, especially yours. That the seller's lawyer is on vacation sounds like a personal thing to me....does he another lawyer that can cover for him for the closing? You both signed a contract and in a way is to protect all parties involved. This can be soo tricky because when one party is available then maybe the bank isn't. So get your lawyer involved.
Good Luck and sorry you are going through this !

Re: Closing Question

Re: Closing Question