Tuesday, July 5, 2011
Stuck in Virginia
Every time I get my heart set on a house, something always happens to mess it up. This time we waited until everything looked like it was a done deal with my buyer. Let’s call him Kip. Kip was pre-approved, his buyer was pre-approved, plus his buyer didn’t have a house to sell so we didn’t have to worry about that. Kip’s buyer had already done the inspections on Kip’s house and everything was good there.
I even called the loan officer myself. He said that with Kip’s 20% down, one year’s worth of mortgage payments in escrow (because of relocating and having to start his business over fresh), his good credit and loan-to-debt ratio, there would be no problem. He said Kip was “strong.” The last thing I did was wait for Kip’s buyer to get his mortgage commitment. I covered Kip. I covered Kip’s buyer. Then we went house hunting. We looked at the nuclear reactor house, we looked at the house on the highway, we looked at the house that even I would set a match to.
The Alloway house was funny. The Alloway house was the very first house we were interested in back in the winter when we sold the house the first time but we never went to look at it because it was quite a bit over our price range and the listing agent said the owner wasn’t negotiable. She called it a thorn in her side and said she’d taken dozens of people to see it but he wouldn’t budge a penny. He wanted close to three hundred thousand and our price range was low 200’s so no sense going. But now, lo and behold, it was down to $249,900, plus a new septic tank had been installed. Sometimes things are a blessing in disguise! Our new agent happily took us to see it.
I can’t even go into telling you about it. I’m too upset. By the time I posted the last story about house hunting and was getting ready to tell you about what we got, it’s over. After everything I did to micromanage the deal, all the checking and double-checking I did, after everything I did to make sure everyone was doing their job and no one was leading me on to believe that my buyer could get a mortgage when he couldn’t, the deal fell through.
I found out the day I found out my father passed out on the kitchen floor, woke up vomiting blood, and got himself to the hospital by crawling to the phone and dialing 911. He’s okay now but this is why I have to get home! This is it in a nutshell!
I’m starting to think I’m stuck in Virginia. No matter how well-priced my house is, no matter if I keep selling it over and over again, no bank is going to lend anyone any money to buy it. We gave them all that money to bail them out, and yes, I understand that they’re cautious now and they should be, they shouldn’t have been lending people money for houses they couldn’t afford in the first place. But I keep bringing them buyers who can afford my house and it’s a good house, priced under the appraisal, and if these people can’t get loans, no one’s getting loans. The bank is sitting on all the money and foreclosing on people’s property—they’re like the king—they’re keeping it all! No wonder why the economy is still at a standstill….
The banks aren’t the only bad guys. You’ve also got the henchmen. That’s the lawyers. This is how it all played out: Kip’s buyer learned ten inches of Kip’s backyard was in one of FEMA’s newly designated flood zones and would require flood insurance. Supposedly Kip wasn’t aware of this. Kip’s buyer’s lawyer advised him to ask for more money off the house to “remedy the situation.” I can just picture what he said. “It’s a buyer’s market! You can get another twenty grand off the house for that!” Everyone was happy up until that point, including Kip’s buyer, a first-time home buyer who loved Kip’s house, but was, naturally, afraid to cross his lawyer, and his parents, who were hovering during the entire process like a new mother over a preemie in a crib and were now nodding their heads vigorously because they had such a good lawyer.
Kip said no; he couldn’t afford to give any more money off the house because then he wouldn’t be able to buy mine. I offered to give him another five thousand off the price of my house and the real estate agents offered to take less of a commission to help him make the deal happen. The real estate agents even got the seller of the Alloway house to contribute five grand. Then it was a roller coaster ride. One minute Kip and his buyer came to an agreement, the next minute they didn’t. It was on, it was off, it was on, it was off.
Pretty soon I’m going to be in the hospital with a bleeding ulcer just like my father if this keeps up.
Finally it was on. But then, even though we all kicked in money, Kip still had to lower the price of his house to satisfy his buyer, and now he didn’t have enough money for the 40% down payment the bank wanted. Yeah, if you’re sharp, you caught that. First the bank told us 20%. Now it was forty. I couldn’t believe it. I specifically discussed this with the loan officer myself in the beginning of this process because I didn’t want what happened with my last buyer to happen with this one—the bank leading us all on. But now 20% wasn’t enough. By the time I thought it was safe and bought a house, 20% morphed into 40%. Kip only had 35%. Plus Kip learned that the interest rate on the loan was over 8%, double the going rate.
So the deal is off. And now we are probably going to lose the Alloway house because I was bidding against someone else who wanted it and the reason the seller accepted our offer was because we assured him it was a done deal down here, we were closing, everything had gone through and all we had to do was pack. I suppose there’s a chance the other person who wanted it found another house. Or maybe he won’t be able to get a mortgage the way the banks are holding on to the money. Maybe a miracle will happen and I’ll sell my farm to someone else who actually can close before the Alloway seller finds someone new. I have been getting action. Someone is doing a drive-by right now as I write. I even have someone who came right out and said he wants it but can’t buy it till August when his divorce becomes final.
In the meantime, I can’t even tell you about the Alloway house because I’m so upset.