Can't believe this is happening to me.

[Vibe_2007]

I put a ton of time and money in the past 6 weeks selling my home and finding another home.

Closing is tomorrow morning at 10AM.

I get a call from my realtor a couple hours ago that the buyer quit his job 4 days ago and hired on with a different company.

It was discovered today when his underwriting did a verbal employment check at his job. His financing has been obviously cancelled by his bank.

Feeling absolutely devastated. Cannot believe this happened.

My realtor says we can get the 1000 earnest money deposit from them. Big deal.

Who in the world is that stupid.

Frankly, apart from the loss of a loved one, this is the second worst I've ever felt.

I've got inspection out of pocket, storage fees, UHaul fees, tons of time getting my home in show ready condition, etc.

I think the only person who feels worse than me is my realtor. He is livid!

Wow!

 

[ZeeOSix]

The housing market seems to be pretty much up across the country in larger cities. When the house was on the market was there more than one guy wanting to buy? Put it back on the market ASAP and see what happens.

 

[CT8]

Try to get back up offers .

 

[JeffKeryk]

Generally a loan agreement is a contract. It sounds like the buyer did not really have funding.
Sorry about your trouble. It is just a bump in the road; you will be fine.

 

[StevieC]

When my parents sold in the city to move to the country in 2006 their deal almost fell through because the guy lied on his income statement to the bank he applied for financing and had to pull private financing last minute to save it from going south. My folks were not happy because everything was in boxes and ready to go and some stuff was in storage already.

Wishing you the best of luck finding buyers.

 

[Vibe_2007]

Thanks guys. I appreciate the kind thoughts.

Everything is in storage.

The bright side is that our house went under contract in a just 3 hours from listing it and we got 100% of asking price.

Our neighborhood, luckily, is a very desirable area because of the schools and low crime here.

 

[Vibe_2007]

Originally Posted by ZeeOSix
The housing market seems to be pretty much up across the country in larger cities. When the house was on the market was there more than one guy wanting to buy? Put it back on the market ASAP and see what happens.


Houses are selling here in a matter of hours, especially ones that are newer like the one we thought we sold.

The biggest bummer for me is that the house we were going to buy had a huge yard, quiet street, etc.

It is very easy to sell a house in this town, it is difficult to fine another one.

 

[SatinSilver]

Don't get nasty with the buyer. He likely left the former job for a better opportunity. A new/different bank may view things differently. A mortgage company should be even more forgiving. Esp if everything is on the up and up here. Try not to let the deal die if there's some life left in it. And it sounds like there is. Not like he just quit his job out of the blue with nothing else lined up. Things like this happen all the time. Just stay with it but keep marketing the house to other buyers of course.

More info here:

https://www.zillow.com/blog/get-a-mortgage-with-a-new-job-223707/

 

[ZeeOSix]

Looks like you're back on track.

 

[Vibe_2007]

Originally Posted by JeffKeryk
Generally a loan agreement is a contract. It sounds like the buyer did not really have funding.
Sorry about your trouble. It is just a bump in the road; you will be fine.


Being that the guy intentionally quit his job, knowing he was closing in four days, seems to me like he scuttled this deal. I mean, who doesn't know the golden rule.

You don't open a line of credit, buy a car, or change jobs when you buy a house.

Starting to think this was intentional. I don't get why either. House is only 188,900 bucks with property taxes of only 2100 per year. Very affordable mortgage I believe.

 

[Vibe_2007]

Originally Posted by SatinSilver
Don't get nasty with the buyer. He likely left the former job for a better opportunity. A new/different bank may view things differently. A mortgage company should be even more forgiving. Esp if everything is on the up and up here. Try not to let the deal die if there's some life left in it. And it sounds like there is. Not like he just quit his job out of the blue with nothing else lined up. Things like this happen all the time. Just stay with it but keep marketing the house to other buyers of course.

More info here:

https://www.zillow.com/blog/get-a-mortgage-with-a-new-job-223707/



I truly hope we can save this deal. Maybe something last minute can be done and he get get financing. But I don't have time to wait either. We are living on beds with no box springs, boxes as night stands, and eating take out food every night. My 8 year old is really bummed about this.

 

[Wolf359]

Originally Posted by CT8
Try to get back up offers .


Well no, you can't get a backup offer when you don't have an offer. Sorta like you can't have a backup plan if you don't have an initial plan.

Anyway, not sure what the standard is in SD, but all you can basically do is keep the earnest money deposit so if all they put down was $1000, then that's all you can probably get. That's the danger with these low money down purchase contracts. I've seen this happen before. Also sometimes it's stupid stuff like them buying a truck just before closing so they no longer qualify for financing because their debt to income ratio is now too high.

Anyway, I'm not sure your deal is completely dead. Usually if you lose your job and don't have an income, you don't qualify, but if you just switched jobs for more money, you should still be able to get the loan. There may be some delay as they need to redo some paperwork. So if it takes an extra week or two, just bump up the purchase price to make up for the hassle of them not closing on time.

 

[Vibe_2007]

Originally Posted by Wolf359
Originally Posted by CT8
Try to get back up offers .


Well no, you can't get a backup offer when you don't have an offer. Sorta like you can't have a backup plan if you don't have an initial plan.

Anyway, not sure what the standard is in SD, but all you can basically do is keep the earnest money deposit so if all they put down was $1000, then that's all you can probably get. That's the danger with these low money down purchase contracts. I've seen this happen before. Also sometimes it's stupid stuff like them buying a truck just before closing so they no longer qualify for financing because their debt to income ratio is now too high.

Anyway, I'm not sure your deal is completely dead. Usually if you lose your job and don't have an income, you don't qualify, but if you just switched jobs for more money, you should still be able to get the loan. There may be some delay as they need to redo some paperwork. So if it takes an extra week or two, just bump up the purchase price to make up for the hassle of them not closing on time.



You are correct on the backup offer. We had multiple people fighting to get our home, but those folks are long gone now.

I totally agree with your assertion on the EMD being way too low. In this under 200K price range though, most of these millenial folks don't have even 4 or 5 grand to bring to the table.

 

[Zee09]

That sucks!
Best of luck going forward!

 

[Wolf359]

Originally Posted by Vibe_2007
You are correct on the backup offer. We had multiple people fighting to get our home, but those folks are long gone now.

I totally agree with your assertion on the EMD being way too low. In this under 200K price range though, most of these millenial folks don't have even 4 or 5 grand to bring to the table.


Around here the standard is at least 4-5%. Even with FHA, they at least put down 3.5% so even at 200k, you would at least had 7k. That 1000 for EMD is just way too little. I had a friend who put down 1k on a house but then later changed his mind and just walked away from the 1k. I've had buyers do that too, husband saw the house, wife showed up for the home inspection and didn't like it so just walked away with just the 1k deposit. They didn't even try to play games to try to get the 1k back because they could have always said it an unsatisfactory home inspection as there are always some minor issues. At least they were honest with it.

 

[bdcardinal]

Best of luck. It is a really strong market, especially here. People are getting cash offers more than asking price hours after houses are listed. We have even had offers on the house and we aren't selling.

 

[Vibe_2007]

Originally Posted by bdcardinal
Best of luck. It is a really strong market, especially here. People are getting cash offers more than asking price hours after houses are listed. We have even had offers on the house and we aren't selling.


Where I live in Sioux Falls it is hot. 5000 people move here yearly. Our house was appraised at 155 in 2015 to 194 in 2018.

Our town is now 180,000 and to hit 250K in 10 years per the city.

The biggest problem is after you sell, it is hard to find something affordable. For us that is in that 215,000 max home price.

We qualify for more, but I'll be darned if I am going to be house poor.

 

[Vibe_2007]

Just wondering now what happens to the Earnest money I put down on the house I was going to buy contingent on selling mine. Wonder if I lose that money as well.

 

[Wolf359]

Originally Posted by Vibe_2007
Just wondering now what happens to the Earnest money I put down on the house I was going to buy contingent on selling mine. Wonder if I lose that money as well.


Well it depends on the contingency. Did it expire? If not, then you can get it back. Just make sure you follow any deadlines. You also have to notify them that because your house didn't sell, you're using the contingency to get your money back. Usually you get it back because if the house is tied up in litigation which is what you do if you don't get it back, then they can't sell the house.

 

[Vibe_2007]

Originally Posted by Wolf359
Originally Posted by Vibe_2007
Just wondering now what happens to the Earnest money I put down on the house I was going to buy contingent on selling mine. Wonder if I lose that money as well.


Well it depends on the contingency. Did it expire? If not, then you can get it back. Just make sure you follow any deadlines. You also have to notify them that because your house didn't sell, you're using the contingency to get your money back. Usually you get it back because if the house is tied up in litigation which is what you do if you don't get it back, then they can't sell the house.


What you said in your last sentence makes a lot of sense to me. I think we will get it back after reading your post.

Thanks for the helpful advice.