Already gotten one extension, now we may need to switch financing. Best approach?

Asked by Karmann, Crystal Lake, IL Mon May 31, 2010

We've been under contract for a month, and had planned to use conventional financing. Because we're in a distressed area, we're thinking our loan officer is having trouble securing the loan on the terms we agreed to and will want a greater down payment that we don't have (he hasn't said this, but something is causing the delay). We were supposed to close last week, and had to get a two-week extension. Now we're thinking the lender might want us to go FHA instead, which will obviously cause an even greater delay. If you were representing the sellers in this situation, would you advise them to grant another extension? Would concessions on our part (removing the 2% seller contribution, for instance) make you more likely to agree to the extension? The house has been on the market for a year, and our offer was 98% of the appraisal, if that makes a difference.

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Robert Spino…, Mortgage Broker Or Lender, Mill Valley, CA
Wed Jun 2, 2010

I think it would be fair to request a status from your lender/broker, and if he is a professional, he would also be willing to personally communicate this to the Realtors on both sides of the deal. If you're not getting that level of service, I would suggest you place some effort there before approaching the seller.

If you were in the seller's position, you would want to have reliable information on which to base your grant of any extension. You should work to be able to provide them with that.

Good luck and let me know if I can help.

Thank you,

Rob Spinosa
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