We have read a lot and had numerous discussions with friends who have bought houses. Everybody has a story how something goes astray last minute. We are no exception – and just in case you are interested – here is our account of how our resolve got tested:
3 days to closing
We really need to get the mortgage commitment letter from ShoreBank so that we can formally schedule the closing that has been set for this Thursday (see also 04/13/2009 post). I started to poke around and finally found out that nothing is moving or happening because ShoreBank had no proof of insurance and no loan approval.
Didn’t I just send our proof of insurance (see also 04/13/2009 post)? It turns out that the preparation of closing documents is passed from Phil (our banker) to a different person (Pat) in a different ShoreBank branch office. Resolving the proof of insurance issue is easy: I just e-mailed Pat the documents.
2 days to closing
I receive an e-mail from Joe Ziccardi (our attorney) that the proof of insurance has to be re-issued. ShoreBank needs us to change the mortgagee information on the document and also a copy of the receipt as proof of payment. I scrambled to get the insurance broker to re-issue our proof of insurance and e-mailed it with receipt of payment to ShoreBank.
29 hours to closing
The loan approval is still missing! I am back on the phone to find out that it got somewhere stuck in the transfer from Phil to Pat. The seller told us in no uncertain terms that closing would not be delayed again and we are still fussing around with a critical document lost in transit. Phil was very apologetic and went personally after the documents to make sure they arrived at Pat’s desk. Finally, the mortgage commitment letter went out.
25 hours to closing
We receive good news from Joe . We have our closing scheduled, with confirmed location and time. We will still close on Thursday – hurray, no further delays!
20 hours to closing
We stop by the two-flat to have a last look before we purchase it. Everything seems normal until I notice that the front basement door is not closed. The locks are busted! Thanks God I have the tool bucket in the car. Cathy and I are able to barricade the door and have the property secured again. Not how we wanted to spend the evening.
16 hours to closing
Back home, we had the HUD-1 settlement statement and other paperwork in our inbox for us to review. We e-mailed a couple of questions to Joe.
What is a HUD-1? (HUD – U.S. Department of Housing and Urban Development)
“The HUD-1 Settlement Statement is a standard form which is used to itemize services and fees charged to the borrower by the lender or broker. The borrower has the right to inspect the HUD-1 one day prior or day of settlement. The form is filled out by the settlement agent who will conduct the settlement. Borrowers may compare their Good Faith Estimate to the HUD-1 Settlement Statement and ask their lender or broker about any changes.”
14 hours to closing
I had a few beers to calm me down, and am pleased to report that this proceeded without any delay or glitches – which was very refreshing indeed.
7 hours to closing
We got a prompt, first thing in the morning and straight forward response from Joe on our HUD-1 questions. This is what we love about Joe: very responsive, extremely reliable, and really good at explaining things.
2 hours to closing
Michael (our Realtor) called: The seller’s Realtor does not have the earnest money! Well, we are confident that they received the earnest money, but probably misplaced it – which would fall right into the pattern they displayed in the past (see also 04/08/2009 post).
OK, let’s assume that, for whatever reason, they did not receive the earnest money. Why on earth are they noticing 2 hours prior to the closing? I can’t believe they are still in business, operating like this…
We resolved the issue by agreeing to bring another cashier’s check to the closing table to cover the missing earnest money.
1 hour and 30 minutes to closing
Cathy is back from the bank with the earnest money cashier’s check. She also made sure to stop payment on the original earnest money check.
1 hour prior to closing
Departure to the title company office for the closing.
I have to say that I had imaged the pile of paper we needed to sign to be much more intimidating and big. It was not that bad at all. There was not one document that we did not expect or did not know about.
In addition to that, Joe did an excellent job walking us through every document, explaining it, and making sure we understood the legal jargon and knew what we were signing. We also took our time in reading through some of the less familiar documents.
1 hour and 30 minutes into the closing
S. O. L.! Because of the missing earnest money check and having to replace it with a cashier’s check, our HUD-1 has changed: the line item for the earnest money needed to be removed to reflect the fact that we were now bringing it to the closing table. To finish the closing process, everybody has to sign the new HUD-1, including the bank that owns the property – that bank that has been so unbelievably elusive. “May be we’ll hear back from them today, if not hopefully tomorrow…”
We have to leave the closing table without completing the deal, without any keys. Actually, there were no keys anyway. The seller’s Realtor, who misplaced or lost our earnest money check, did not show at the closing. So we will have to go to the property and retrieve the key from the lock box – once we have the signed HUD-1 back from the seller… Can it get any more anticlimactic that this?