Investment Property: More Negotiating and Closing
I've been posting about the process we've been going through in purchasing our first investment property at http://www.theripplesaffect.blogspot.com Here is an update on the negotiations and closing of our property.
We had the home inspection in the beginning of June. The home inspector listed a few minor things that could be done, nothing major. We asked the sellers to have the furnace and air conditioning serviced and cleaned as they are old and really could use a good cleaning. We also asked the seller to fix a double tap on the electric box. Both of which she agreed to have done.
We weren't scheduled to close until July 12. But on June 25, I received a call from our mortgage broker saying that if we could move up the date on the insurance policy, we could close on June 28th.
June 25th was a crazy day with lots of calls going back and forth between me, the mortgage broker, our realtor and insurance agent but in the end we will were able to close on June 28th. Here are some of the weird things that came up on June 25th:
- Mortgage Broker called and said the underwriter hadn't verified funds and she needed to know where the money was coming from to make the down payment and pay closing costs. I provided all of our bank statements weeks ago. I find it funny that we are taking out a loan that requires a 20% down payment and no one thought to look before today to make sure we actually have the money to pay it.
- Real Estate Agent called and said that the seller never had the double tap on the electric box fixed. She said that we technically could walk away from the deal because of this. I asked why the seller never had it fixed since it was in the contract. Apparently the seller's brother told her not to fix it because the double tap was there when their mom bought the property so therefore they shouldn't have to fix it to sell it. Really?! It was in the contract that she signed! I almost wanted to walk away just because they were being so stupid about it. But in the end my real estate agent said that she and the seller's agent are going to get someone in to fix this at their cost.
- Mortgage Broker called and said that since the insurance policy I signed started July 1st, I had to have the insurance change the policy date to June 28th. The Insurance company said this isn't possible, they have to cancel the policy that I just signed last week and open a new policy. The Real Estate Agent wasn't to happy about this because of course the mortgage broker needed proof of insurance that day before we could schedule to close on Friday and this all came about around 2pm in the afternoon.
In the end, it all worked out and were able to close on June 28th.
I found a great resource for beginning real estate investors at biggerpockets.com.