Hi Darby,

It is unfortunate this happened, especially just 10 days prior to the scheduled close. However, having things come up near the end of escrow that cause escrow to be delayed is becoming more common particularly in this new lender documentation review, verification and processing environment. I have not run across income tax return not having been filed, however I have seen the scheduled escrow delayed for many other reasons, sometimes for weeks or months just do to something as simple and straignforward as the lender not getting the appraisal done. You want to pull your hair out! In some cases, it is the other way around where the buyer suddenly discovers something about the property that either the sellers did not disclose or were unaware of and needs additional time to investigate. Regardless of the reason for the delayed closing, both parties need to understand things happen and be willing to work together to get the issues resolved. This is where it helps to have experienced real estate agents communicating effectively with each other and their clients to keep the process going. The sellers may want to cancel just out of frustration, and may have the legal right to do so, however unless they have another buyer waiting in the wings, they may still be better off waiting for your loan underwriter to get all the necessary documents, than start over. My advice would be to try to keep a channel of communications open between both your agents, so that if a new buyer is not found prior to getting your loan docs in order, that you can quickly pick up where you left off and get the deal done. And keep in mind that the next buyer that comes along may also run into some closing issues, so if you have not burned your bridges with the sellers, you may be able to get back in the game. In meantime, keep working on your loan docs as you will need them to be in order whether this deal is resurrected of if you go on to the next deal later on. And stay positive as there are LOTS of great deals out there so if this one does not work out, there will be another one that comes along that will be just as good, and possibly even better. Best of luck to you.

Larry

Darby,
If you were in the sellers shoes, would you feel comfortable extending the process? I would probably do the same thing they are. Your agent needs to really go to bat for you with their agent right now. This can be ironed out, but you cannot hide any information. Give them the number to your loan officer, and encourage them to confirm everything with him. Then push push push the IRS and your loan officer. Call them daily, if not hourly to get to the bottom of this.

Good Luck!

It may not be your fault but the truth is that you are not qualified because of the missing link of your taxes which the underwriter does need to approve you. If the underwriter won't' approve your loan without the tax return then you will have to wait to be properly qualified but the seller does not have to wait for you.