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feelmydread · Joined: 19 Nov 2009 Posts: 5 2.77 Dollars($)

Hi everyone,

First time poster here but have been reading this forum and really appreciate the advice that is shared on this vibrant community. Kudos to those that make this forum a great place.

I am in escrow on a short sale property in California which will hopefully become my first home. yay!

My real estate agent sent a contract to the lender which stipulated that the lender would pay for the closing costs (4% of purchase price).

My agent stated in writing that the lender agreed in the approval letter to pay the 4% credit but that the approval letter mistakenly listed the credit as HOA fees instead of as closing costs. My agent later informed me in writing that the situation was resolved and the 4% was being applied to my closing costs.

Fast forward three weeks to this afternoon, my home is about to close in 3 days, my agent sends me an email stating that the lender says that they are not going to approve the closing cost credit and that they want me to pay it.

Question: What is the recommended course of action I should take at this time? Is there anything I can do? Can I push back (on the lender or my agent) or do I risk loosing the property? I am at the edge of what I can comfortable afford in terms of upfront costs. I am so disappointed in my agent and sad about this situation.

Thanks,
Andres
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Here is the email that I just received from my agent:

Hi Andres,

Unfortunately we have some bad news from the lender, who is now saying that they are not going to approve the 4k closing cost credit! We asked for it in the offer, it was in the approval letter but in the form of the HOA credit. I informed the listing agent weeks ago that we are not asking for an HOA credit but a closing cost credit and she said she would send an updated HUD to the lender and have it changed to a closing cost credit. Now the lender is saying they wont pay it.

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gmakerley · Posted: Thu Nov 19, 2009 9:38 pm Post subject:

i don't know what kind of recourse you have, inasmuch as the approval letter cited the hoa credit this lender desires to pay. push back? of course you should! will it work? well, you won't know until you try. i'm not sure what the hoa fee payment is supposedly for - probably past due amounts from the prior owner, i suppose?

this is disappointing, no doubt; keep pushing is my idea, though.

eric1 · Posted: Fri Nov 20, 2009 6:44 am Post subject:

I have identified the problem. You received a letter from your realtor who in turn heard from your lender? Then the portion of the letter attached goes into detail about how there is communication between the realtors about your approval or commitment letter.

REALTORS SHOULD NOT BE BETWEEN YOU AND YOUR LENDER !!

The primary contact with your lender should be YOU. You are the one who should have been trying to resolve the issue weeks ago. Were you using the realtors in-house loan officer? If so, then you can have your lawyer go after the real estate agency as whole for the mis-communication.

You are using a lawyer....right?

jveenstra · Posted: Fri Nov 20, 2009 1:09 pm Post subject: HOA

HOA fees are not what you wanted to use the credit for, but, if worse comes to worse, maybe you can take the HOA credit. The HOA fees need to be paid sometime by someone. WE do not know exactly what the HOA fees are for. If there is a monhtly HOA fee, maybe use the credit to prepay many months.
Perhaps better than losing the credit altogether.

feelmydread · Joined: 19 Nov 2009 Posts: 5 2.77 Dollars($)

Thank you for the replies. Especially gmarkley and jveenstra.

JV, I had the same thought as you in regards to getting the credit applied to future HOA fees. GM was correct though in that the HOA credit was for monies owed by the seller only and the lender wanted the rest back.

Ultimately I assertively communicated with my agent that he needed to speak with the seller's bank (not my lender) directly and negotiate with them about the fees. My agent was relying on the seller's agent to clear up the miscommunication with the bank. The problem has been resolved though I am still waiting for a copy of the contract so I can see it in writing.

Eric1: You misunderstood my initial post. This issue involves the seller's lender not mine .

eric1 · Posted: Sat Nov 21, 2009 7:09 pm Post subject:

You are right, I misunderstood

jveenstra · Posted: Mon Nov 23, 2009 7:05 am Post subject: HOA

feelmydread, Sounds like you are moving along ok. Good luck

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