September 4th, 2014 at 12:09 am
New disclosure rules require that any seller credit must be noted by the appraiser in the appraisal report and documented by an RPA amendment before closing can occur.? ? Often lenders require the credit be fully disclosed in the transaction documents BEFORE? the loan docs can be issued.? ? As such, a last minute seller credit can delay a closing and cause the buyer to be in breach of the RPA.
We have seen the following? scenario occur too often:? Approval is in, ? Buyer removes Loan Contingency, Buyer is? ready? to sign loan dos, HSL/Lender ? asks for a HUD and the lender is apprised for the first time that there is a new credit to Buyer.? ? Subsequently the Lender alerts the appraiser to make a change, and Buyer may? risk a 3-day waiting period and delay imposed by the lender.? The Buyer is then in breach, and Seller? may issue a Demand to Close and cancel the deal.
Agents please? disclose these credits to the lender as soon as they are negotiated.? Waiting? 1-2 days before closing may have negative consequences and cause the Buyer to breach the RPA.
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