FSD, that was my thought, too. Really, how much could the 30 fixed MIR rate have changed from 21 or even 30 days ago? And I agree that if it is even up a fraction of a point, that is not enough to kill the deal unless it really isn’t a “deal” to begin with.
I understand how hard it is for leveraged buyers to enter into and stay in a transaction today. But, based on jimmy’s posts here, I feel there is more at play here. He has a really bad agent who didn’t protect his interests when writing an offer and did not vet the sellers well enough before placing it his behalf.
I see a LOT of potential problems for jimmy if he wastes more time in the transaction:
-He could be required to pay “sellers” FY 2012-2013 back taxes plus penalty plus any accrued taxes after the beginning of the new FY, which begins July 1, 2013, in order to consummate the deal;
-He didn’t get the PTR until 15 days after he opened escrow and well after his contingency period expired (inexcusable and implies that sellers had something to hide);
-Seller could refuse to vacate at closing, or worse, vacate the day of closing and leave all their debris while stripping appurtenant items they believe are “theirs” (ie ceiling fans, custom blinds, fireplace enclosure, etc);
-He could be pressured to sign docs by his agent without first getting a comprehensive walk-thru to make sure the property is vacant and intact;
-He could be asked to pay the difference to “sellers'” lender(s) between the what is owed and what the lender will accept to consummate the sale (over and above his accepted-offer price); and,
-A NOD could be filed by a third-party trustee at the 11th hour thereby hosing up the whole transaction while jimmy’s rental gets re-rented because his LL thinks he’s moving.
etc, ETC….
It is possible this listing agent originally listed the property at a higher price trying to test the market to see if his/her “sellers” could get enough to break even and pay the taxes owed. But the minute he/she lowered the price enough to attract jimmy and possibly other bids, he/she should have delisted the property and relisted it as a “short sale” with the new price and stating clearly on the pfl that lender approval was needed. Instead the LA “pretended” that it was a traditional sale all along and required jimmy to post an earnest-money check with his offer … or at the very least, accepted that check from his agent without telling them that the listing was a short sale. “Sellers,” along with their complicit agent, “accepted” jimmy’s terms of a 21-day closing and short contingency-approval window all the while KNOWING they could not possibly perform as lender negotiations for the short payoff had not even begun. Meanwhile, jimmy is scrambling to hold his end up on the deal and “sellers” and their agent are thwarting him every which way by having their “selected” escrow company (“in-house” possibly?) send him another transaction’s escrow instructions TWICE and “sellers” selected title company waits 15 days to send him his preliminary title report. There is absolutely no excuse for that. Meanwhile, jimmy decides to avail himself of the public tax screen and finds out the taxes are delinquent, approaches his agent with the problem and he/she tells him, “It’s okay, there’s plenty of funds in escrow to pay them.”
If jimmy’s agent actually really did select services, than jimmy’s agent is entirely complicit in the failure to disclose to jimmy the condition of the title early on, whether the delays were caused by incompetence of the service providers … or not. Actually, jimmy’s agent could have gotten a “property profile” on the property in just minutes or hours, checked the public tax screen and wrote jimmy’s offer based upon that cursory information provided, which would have protected him much better. In addition, REALIST has some of this information available and if jimmy’s agent was worth their salt, they could have pieced it together and grilled the listing agent before drafting their offer.
I say the behavior and incidents described here in totality reek of gross incompetency and may even rise to the level of fraud … on the part of both sellers and both agents. I feel that, based upon his posts, jimmy is completely justified in telling them all to pack sand, after losing trust in these sordid players. Perhaps there is a way to arbitrate with the listing brokerage to get his appraisal and inspection money back (a few hundred?) or they will agree to pay him these damages up front to prevent him from filing a DRE complaint against them. Unfortunately, he doesn’t appear to have enough damages for it to be worthwhile to sue, and, in any case, needs to find a new agent and put this whole debacle behind him. If he can’t recover his earnest money because it has been commingled, that is a different story and is the prime reason for revocation of broker licenses in CA. But I believe he will be able to.
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If it weren’t for “lender malaise.” there wouldn’t be a platform on which to perpetrate these shady transactions of multiple overt misrepresentations (based on lies) and hook unsuspecting buyers into them. Delinquent sellers would have had their stuff set out on the street after the trustee auction and the marshal’s office (now sheriff) would have locked them out, as it was in decades past. The market has now picked up sufficiently to go back to the following the law in CA and do away with these moratoriums and extensions which have the effect of allowing even strategically-defaulting sellers to squat into oblivion. A RE transaction is stressful enough, (esp for FTB’s) without complicating it with the unsolvable problems of insolvent “sellers.”
