Very nervous about our house purchase not going through! Update

[Faith-manor]

 Update:

We have an agreement with the sellers. Their realtor tracked them down on vacation.

And to those who thought we were strapping ourselves financially, that is a wrong assumption. It was a cash flow issue. It takes two-three weeks to get a check from the retirement account we are using for this. We had just paid summer session two tuition for both of the boys taking summer classes, plus books, plus infused my mother with some cash due to a recent emergency so an extra demand on funds in order to keep closing on track for July 23 which we had not anticipated (dd and hubby's lease expires August 1st so we were hoping to get them moved before then and not have a lease issue to deal with) was the problem, and wondering how our mortgage company would react if the two repairs were not made. Despite a weekend of angst and waiting, and then wondering why the sellers were not returning their realtor phone messages yesterday, it worked out about an hour ago. So I am back to my happily planning self! Thank you to all for your advice and support.

Old post: So we just received the home inspection report. On the one hand, for a house that is 24 years old and really hasn't had anything done to it in all that time except the roof, it was good. On the other hand, the home owner likes to "rig" things when there are minor repairs instead of doing the job correctly or hiring a licensed individual to do it which has caused some issues. We estimate there is about $5000 of repairs that must be done in order to satisfy our mortgage company and the home owner's insurance. Every one of them is something we can easily do ourselves because of Dh's background. We renovated this now 118 year old church and passed every inspection with flying colors. But we doubt that the mortgage company is going to allow it to go to closing without the repairs completed. The offer was contingent on the home inspection report and appraisal so we can get our earnest money back. But we don't want the sale to fall through. We love this house. However, the elderly couple who own it are a bit "stuck in their ways" if you get my drift, and our realtor says their realtor is a bit delusional about how much they can get for this house so may advise them not to pay for repairs. We made a full price offer, and the house was on the market over 60 days at that time in a market in which houses closer to Huntsville sell within hours of being listed. We were the only showing. Not many people want to live at the top of the mountain where the cove below is not open for development because it is protected due to some endangered species of wild bats living in the cave system at the base. It will keep appreciating for sure, and there is development in a different cove just a few miles away, very high end homes going up there. However, our offer is very likely, according to our realtor, the best they will get, yet she thinks this is something they do not understand.

They have no mortgage. They paid cash when they bought it 8 years ago, and are getting double what they paid.

We have maxed ourselves out with what we can realistically do given that we need to keep reserve savings just in case something else went wrong with it or with our house here. The joys of home ownership! 😜 A year from now, no worries, we could up our offer by the cost of repairs and then have the work paid for at closing. A year from now we are done paying for tuition, room and board. Lots more wiggle room.

So today I am nervous. I don't know what to expect Monday. Our daughter went to the home for the inspection with our realtor, and the homeowners were there. They really took a shine to her and loved the idea that their house would have children in it, that it would be multi-year rational. They have already purchased a condo in a retirement complex in Florida, and told her they transferred their medical records and even have doctor's appointments in Florida at the end of the month. They have advertised their estate sale. I am hoping this means they are locked into moving enough to be willing to do the repairs. But who really knows!

I am having a hard time concentrating on anything else today.

 

Edited June 8, 2021 by Faith-manor

[Catwoman]

1 minute ago, Faith-manor said:

So we just received the home inspection report. On the one hand, for a house that is 24 years old and really hasn't had anything done to it in all that time except the roof, it was good. On the other hand, the home owner likes to "rig" things when there are minor repairs instead of doing the job correctly or hiring a licensed individual to do it which has caused some issues. We estimate there is about $5000 of repairs that must be done in order to satisfy our mortgage company and the home owner's insurance. Every one of them is something we can easily do ourselves because of Dh's background. We renovated this now 118 year old church and passed every inspection with flying colors. But we doubt that the mortgage company is going to allow it to go to closing without the repairs completed. The offer was contingent on the home inspection report and appraisal so we can get our earnest money back. But we don't want the sale to fall through. We love this house. However, the elderly couple who own it are a bit "stuck in their ways" if you get my drift, and our realtor says their realtor is a bit delusional about how much they can get for this house so may advise them not to pay for repairs. We made a full price offer, and the house was on the market over 60 days at that time in a market in which houses closer to Huntsville sell within hours of being listed. We were the only showing. Not many people want to live at the top of the mountain where the cove below is not open for development because it is protected due to some endangered species of wild bats living in the cave system at the base. It will keep appreciating for sure, and there is development in a different cove just a few miles away, very high end homes going up there. However, our offer is very likely, according to our realtor, the best they will get, yet she thinks this is something they do not understand.

They have no mortgage. They paid cash when they bought it 8 years ago, and are getting double what they paid.

We have maxed ourselves out with what we can realistically do given that we need to keep reserve savings just in case something else went wrong with it or with our house here. The joys of home ownership! 😜 A year from now, no worries, we could up our offer by the cost of repairs and then have the work paid for at closing. A year from now we are done paying for tuition, room and board. Lots more wiggle room.

So today I am nervous. I don't know what to expect Monday. Our daughter went to the home for the inspection with our realtor, and the homeowners were there. They really took a shine to her and loved the idea that their house would have children in it, that it would be multi-year rational. They have already purchased a condo in a retirement complex in Florida, and told her they transferred their medical records and even have doctor's appointments in Florida at the end of the month. They have advertised their estate sale. I am hoping this means they are locked into moving enough to be willing to do the repairs. But who really knows!

I am having a hard time concentrating on anything else today.

 

I hope everything works out for you, Faith!!!

[Faith-manor]

3 minutes ago, Catwoman said:

I hope everything works out for you, Faith!!!

Thank you! I appreciate that. Ugh. I think the worst thing was getting the report at 5 pm yesterday so we have the whole weekend just thinking about it without beginning any kind of solution process.

[pinball]

So what does this all mean?

It’s $5K in repairs and the owners won’t do them?

And if they don’t do them, you can’t get a mortgage?

[Faith-manor]

19 minutes ago, pinball said:

So what does this all mean?

It’s $5K in repairs and the owners won’t do them?

And if they don’t do them, you can’t get a mortgage?

Yes. They are vitally necessary repairs, two of which are important enough that home owner's insurance could be a sticky wicket.

[Kassia]

Ugh - that is so stressful!  Hope it all works out.  I'd be nervous, too!

 

[Faith-manor]

34 minutes ago, Seasider too said:

So now that they have an inspection report, at least in states we’ve bought and sold homes, this info is now required to be part of their disclosure statement in their property listing. Which would theoretically make it less attractive to other prospective buyers. Of course in a crazy market many things are going “as is,” so it may be moot. However, perhaps this is something your agent can use to lean on the other agent to get them to take care of it?

In the current market, I’d normally say to make the deal work, take the lump and roll it into the mortgage. But it sounds more like a cash flow problem, right?

Two things come to mind. If this house’s DOM was 60, how long are comparable as staying on? Long enough to justify fighting about it? Because, gotta be honest, sounds like these folks have the time and obstinance to hold out. Not saying they’ll ever get the price they want, just saying they can maybe comfortably wait longer to admit they’re priced too high. Locally we are seeing sales being made under freakish terms - going way over list price, inspections totally waived, cash guarantees for the gap between sales price and appraisal. Just nuts. Hate to point out that the general market is waaaay in the seller’s favor right now. 
 

Hopefully they have an agent that is more willing to help them come to a proper realization than to hold out for a hopefully higher commission. 

I just don't know except that they told our daughter and realtor that they already have purchased their condo in Florida and had appointments in the next two weeks in Florida with their new doctors. They had all the furniture priced for their estate sale which has been advertised. The wife was sad about leaving because she loves the house so much, but admitted they can't physically care for it anymore and need to live closer to their kids in Florida. So maybe that will mean they are willing to work with us on this. Fingers crossed.

On another note in an attempt to distract myself I washed the light shades of our fixtures in the kitchen. They have needed it for a while. Now I need to go knock something else out in the hopes of not thinking about it too much.

[Catwoman]

If you need more distraction, you can come over and wash all of my light fixtures. Or paint my house or something.

(Just trying to help! 😉 )

[hjffkj]

What are the issues? If they are really issues that won't allow someone to get a mortgage the owners may be willing to fix them. But in the market we're in where I am that wouldn't be likely. The seller would just relist the house with the new disclosures and would have another acceptable offer in a day

[Bootsie]

Did your offer contain any contingency regarding repairs?  Where I lived before, it was common for contracts to have a clause stating that seller would pay up to $x of repeairs and then if the inspection report should more further negotiation could occur.  Where I live now, it is more common not to have such a clause but just base on offer contingent on an inspection report--I really prefer the first; IME no house is going to come out with a perfect inspection report; everyone is excited about the deal and then when the report comes out both buyer and seller are disappointed and "surprised".

I don't remember the mortgage companies ever being concerned about an inspection report.  They simply looked at comps.  The insurance company always sent their own person out to check the roof, etc. and I don't recall that they looked at the inspection report.  

[TravelingChris]

I really hope they do the repairs.  Is it LandTrust land that the house is next too?

[hjffkj]

You could also offer to up the sale price by the cost of the repairs if they will do them prior to closing. If you can swing that new mortgage amount. Not the most financially sound route to go but if the sale falls through and finding something else would be hard it may be worth it

[Faith-manor]

22 minutes ago, TravelingChris said:

I really hope they do the repairs.  Is it LandTrust land that the house is next too?

The land in the cove is protected, and owned by a conservation group. This is all we know other than the National Speleological Society has surveyed the caves for the state. It was named a National Natural Landmark in 1973.

 

[TravelingChris]

4 minutes ago, Faith-manor said:

The land in the cove is protected, and owned by a conservation group. This is all we know other than the National Speleological Society has surveyed the caves for the state. It was named a National Natural Landmark in 1973.

 

My family are members of the National Speleological Society and of the HUntsville Grotto.  THe headquarters of the NSS are here in HUntsville.  We even have caves under downtown/.

[Faith-manor]

1 hour ago, TravelingChris said:

My family are members of the National Speleological Society and of the HUntsville Grotto.  THe headquarters of the NSS are here in HUntsville.  We even have caves under downtown/.

We haven't been able to find out a lot. This is what we were told, but I haven't seen the paperwork so I hope the realtor is right because it would be very convenient to have a group so close by to ask about the history and ecology.

[Spy Car]

Pulling for you.

Bill

[elegantlion]

I hope it all works out for you. 

[math teacher]

I hope your weekend is full of distractions, and you get good news on Monday!

[*Jessica*]

Fingers crossed that it all works out for you!  

[Halftime Hope]

From experience, this is the precise reason there are realtors involved.  It is their job to convince the seller to be reasonable, since part of this is due to their non-standard repairs which would not pass muster, and since it's in the sellers interest to close the deal and move on with their lives, given the history thus far.  

Good luck! 

[Faith-manor]

Thank you everyone! I appreciate the encouragement. Dh is in an odd mood and put an absolutely AWFUL movie, just so pathetic on for us to watch. Oh.my. word. Sharknado bad.

That had been a two hour distraction in which I spent most of it scowling at him!

[fraidycat]

Buying and selling houses is soooo stressful!

I hope it all works out for you.

In my experience, the homeowners insurance didn't ask anything about the inspection or if any repairs were needed that I can recall.

[pinball]

17 hours ago, hjffkj said:

You could also offer to up the sale price by the cost of the repairs if they will do them prior to closing. If you can swing that new mortgage amount. Not the most financially sound route to go but if the sale falls through and finding something else would be hard it may be worth it

But Faith said the repairs are only $5000...that has to be a minuscule amount in relation to the entire mortgage.

I mean, if $5000 more than you’ve already bid for your dream house will put it out of reach, maybe it is not affordable or a good idea in the first place?

 

 

[hjffkj]

33 minutes ago, pinball said:

But Faith said the repairs are only $5000...that has to be a minuscule amount in relation to the entire mortgage.

I mean, if $5000 more than you’ve already bid for your dream house will put it out of reach, maybe it is not affordable or a good idea in the first place?

 

 

Oh I know.  The new mortgage amount would not be much at all but plenty of people get caught up in the emotions of buying a dream house that they stretch themselves too thin on mortgage payments.  It happens all the time.  Not knowing the OP's finances at all I can only comment with the most sound advice I have, which is making that offer only if it fits into her financial goals and plans.

[ktgrok]

If you were local I'd say to talk to seller about letting you get in there to fix the stuff before closing. (we did that with our current house). But you are NOT local..so..ugh. Prayers for a fast resolution. 

[Annie G]

If the owners won’t agree to do the repairs that you’d need to secure the mortgage, could you get a line of credit or second mortgage to do the repairs and then pay that back in a year or two when your college costs ease?  It’s better than adding 5K more to a mortgage and paying it over many years.

Maybe the owners will agree to fix at least half the items. It’s pretty frustrating that they’re not willing to fix things that are vital. It’s not as if you’re asking for new paint or other discretionary things! I hope it works out. 
 

I’m shocked the negotiations aren’t happening over the weekend. When we bought and sold in 2019 we haggled and such over weekends. 

[mommyoffive]

Sending good thoughts your way!  I hope you get to close on it.

[Terabith]

On 6/5/2021 at 9:43 PM, Faith-manor said:

Thank you everyone! I appreciate the encouragement. Dh is in an odd mood and put an absolutely AWFUL movie, just so pathetic on for us to watch. Oh.my. word. Sharknado bad.

That had been a two hour distraction in which I spent most of it scowling at him!

So, I actually watched Sharknado, and it was terrible, but did you see Lavalantula?  I watched it on vacation once, and it was surprisingly good!

[Frances]

11 hours ago, Annie G said:

If the owners won’t agree to do the repairs that you’d need to secure the mortgage, could you get a line of credit or second mortgage to do the repairs and then pay that back in a year or two when your college costs ease?  It’s better than adding 5K more to a mortgage and paying it over many years.

Maybe the owners will agree to fix at least half the items. It’s pretty frustrating that they’re not willing to fix things that are vital. It’s not as if you’re asking for new paint or other discretionary things! I hope it works out. 
 

I’m shocked the negotiations aren’t happening over the weekend. When we bought and sold in 2019 we haggled and such over weekends. 

A line of credit would likely be at a higher interest rate and there could be additional closing costs for a second mortgage or LOC. They could just make some extra principle payments on the primary mortgage when their finances free up after they finish paying for college.

Edited to add that I hope everything is resolved quickly and the OP gets the house!

Edited June 7, 2021 by Frances

[Faith-manor]

There haven't been any weekend negotiations. The owners went to Florida for a few days, and our mortgage broker was on vacation as was their realtor. Hopefully someone will begin communicating tomorrow!

[Melissa in Australia]

Sending positive thoughts 

[Annie G]

14 hours ago, Frances said:

A line of credit would likely be at a higher interest rate and there could be additional closing costs for a second mortgage or LOC. They could just make some extra principle payments on the primary mortgage when their finances free up after they finish paying for college.

Edited to add that I hope everything is resolved quickly and the OP gets the house!

Yes, you’re right.
When we bought in 2019 our credit Union offered us a LOC with no closing costs and zero interest for 18 months. We’d never considered anything like that and ended up opening it because it’s a ten year LOC and since it doesn’t cost anything to have it, we figured it was worth it in case of emergency.  Kind of a peace of mind thing. 

[Catwoman]

Any updates, @Faith-manor?  I hope you got good news today!

[Faith-manor]

2 hours ago, Catwoman said:

Any updates, @Faith-manor?  I hope you got good news today!

None. Sigh. The home owners went on vacation. Their realtor is having a hard time getting a hold of them. It is frustrating.

I did something normal, and went for a haircut that I desperately needed and then a hike. Now I need to do something else so I don't think about it too much.

[Annie G]

1 hour ago, Faith-manor said:

None. Sigh. The home owners went on vacation. Their realtor is having a hard time getting a hold of them. It is frustrating.

I did something normal, and went for a haircut that I desperately needed and then a hike. Now I need to do something else so I don't think about it too much.

Ugh. I’m so sorry- I know it’s got to be stressful! Two days before our old house was set to close our agent said the application had been flagged and was no longer approved. She got on the phone and within a few hours had an explanation and a timeline for it to get back through approval...and even that length of time made me feel like barfing. 
When does your due diligence period end? If you can’t contact them to resolve this and your DD period expires, what happens? 
‘Hope it’s resolved soon...

[Faith-manor]

New update: Today we requested that they do the two most important items on the list. We also found out we misunderstood our mortgage broker. We thought that the repairs had to be paid for and done before closing, and that was the tight time frame because we just paid summer tuition for two of our sons, and didn't have the $5000 handy. We have an investment account that we can get it out of, but it takes 2-3 weeks to get a check. So that was a lot of the concerns the timing of it all.

That said, we have not financially strapped ourselves as has been suggested. Not at all, and the payment is quite comfortable. However, the timing of everything made for a cash flow crunch. The other thing we needed to consider was how much more we wanted to put into it. Our offer was BEYOND generous. In that particular area, it is not a hot market because most folks do not want to live that far out of Huntsville or Decatur. It had been on the market more than 50 days when we did the virtual tour, and no one else had looked at it much less inquired about it. We have numerous things to do to make it the multi generational dwelling that it needs to be including redoing the wheelchair ramp which was not done properly, hand rails for the two front steps, the private area in the unfinished part of the house so when dh is working there - he can work remote from his Michigan job - he has a quiet area away from the grandsons because he is in meetings and awful lot of the day and often presenting, etc. So a lot to think about. 

Their realtor says he has a phone meeting with them tomorrow to present the request - he finally tracked them down - so we are in waiting mode but also feeling a little better too.

[Faith-manor]

Update in first post.

[Storygirl]

I'm glad it got worked out! What a relief! I'm always extremely stressed during the home-buying process when things crop up. I hope it is smooth sailing for you from here on out!

[Spy Car]

Glad to hear your good news!!!

Bill

[mommyoffive]

Yay, I am so glad it worked out for you!!!  Congrats

[Jenny in Florida]

On 6/5/2021 at 11:09 AM, Faith-manor said:

 Update:

We have an agreement with the sellers. Their realtor tracked them down on vacation.

And to those who thought we were strapping ourselves financially, that is a wrong assumption. It was a cash flow issue. It takes two-three weeks to get a check from the retirement account we are using for this. We had just paid summer session two tuition for both of the boys taking summer classes, plus books, plus infused my mother with some cash due to a recent emergency so an extra demand on funds in order to keep closing on track for July 23 which we had not anticipated (dd and hubby's lease expires August 1st so we were hoping to get them moved before then and not have a lease issue to deal with) was the problem, and wondering how our mortgage company would react if the two repairs were not made. Despite a weekend of angst and waiting, and then wondering why the sellers were not returning their realtor phone messages yesterday, it worked out about an hour ago. So I am back to my happily planning self! Thank you to all for your advice and support.

 

Yay! I'm glad to hear it worked out. Having been around this block myself recently, I know exactly how anxiety-producing the waiting can be, not to mention how difficult it is to juggle the timelines for various financial components. Even when the money is "there," it can be challenging to make sure it's exactly there exactly at the moment it needs to be.

Crossing my fingers the process goes smoothly for you from this point on.

[Annie G]

Glad to hear it’s worked out! Congrats on the new place.

[mominco]

Yay!Congratulations!

[Kassia]

Congratulations!  🙂

[fraidycat]

Yay! I'm glad it worked out. I hope it sll goes smoothly from here on out!

[Corraleno]

Yay, so glad everything worked out for you!

[bibiche]

Congratulations! May you pass many happy moments in your new home. 😊