Q: I signed an agreement of sale my house in Normandy last week and will go to settlement on June 14. I figured that would be enough time to find a house to buy. Today I made an offer a house in Levittown, but the owner of that house wants to go to settlement May 31 because he is buying a house in the Poconos. I need to sell to buy, and I already found out I can’t get a bridge loan. What else can I do?
A: Bridge loans used to be an option, and may still be for some, but you don’t see them as often as you used to. Buyers who had a house to sell and needed to make settlement before the house they were selling could get the loan in advance from their mortgage lender. It’s great. . . until the buyer of the home you’re selling doesn’t make it to settlement because they didn’t get funded for the mortgage after all. Then it’s a disaster.
The only thing you can do to satisfy the Levittown seller is ask the buyer of your home to move up his settlement date two weeks. If this is easier said than done and your buyer won’t, or can’t, change the settlement date, tell the Levittown seller to ask for a two-week extension on his agreement of sale for his Pocono house.
If this Levittown seller is smart, and you’re offering him the money he wants for his home, he will make arrangements to push his settlement date back two weeks. The only other alternative for this Levittown seller is to find a new buyer, and although it is an option, how easy is that to do in the next two to three weeks? Unless he finds a cash buyer in the next two months, he won’t be able to get to settlement by May 31 because most buyers need 30 to 45 days or more to secure their mortgage.
Stacey McCarthy is a real estate agent with the McCarthy Group of Keller Williams. Her Real NEastate column appears every Wednesday on NEastPhilly.com. See others here. Read other NEast Philly columns here.