Disappointing Week

December 30, 2009 · 13 comments

It’s been one of those weeks where I really wish I wasn’t in this business…

We were scheduled to have four closings this week — the sale of The Poor House and The Mini House and the purchase of The Pine House and The Neighbor House — but it looks like we’re not going to have any closings at all.

The Poor House is the greatest frustration this week. The buyer was ready to close last week, and was standing in the bank to get a cashiers check for his downpayment, when his mortgage broker scared the hell out of him and made him change his mind about buying a house. The abbreviated story is that the buyer is a 76-year old man who has never purchased a house before. He is already distrusting of those in the real estate business as is, but when his broker confused him about how to provide funds for the closing (he was originally told to get a certified check and then was told to wire the funds), the buyer decided that everyone he was dealing with was a crook, and became terrified of completing the transaction.

Long story short, his agent is still desperate to get this deal closed, but we’re pretty certain that this guy won’t be buying a house any time soon, so we’ve put The Poor House back on the market. Unfortunately, all the staging furniture has already been moved out of the house and into Staging Project #3, so the house is currently not staged. We’ll decide sometime in the next few days what our plan is to restage it (or not).

The Mini House was scheduled to close on Thursday of this week (tomorrow). We knew that the appraisal hadn’t yet been completed (the appraiser would have had to call us just to get into the house), but the mortgage broker, buyer’s agent and buyer were all convinced that it had. Yesterday, I called the broker, and asked if the closing was going to be scheduled for Thursday, knowing that it wouldn’t be. He said he was just waiting for the appraisal to be uploaded into the system and then the closing would be scheduled.

Instead of arguing, I just said, “Okay, let me know when the closing is scheduled. But, if it doesn’t get done by this Thursday — the contractual closing date — we’re going to put the house back on the market and keep the buyer’s deposit.” Within a couple hours, I received a flustered call from the buyer’s agent, who explained that there had been a mix-up and that the appraisal hadn’t been completed yet (surprise, surprise), and that the appraiser would be out to the house within 24 hours.

The buyer can extend the contract closing date by 7 days one time without our permission, so they actually will have until next Thursday to close, and I know they are scrambling to get it done before then. If they don’t hit that date, I’ll happily keep the buyer’s deposit and put the house back on the market. We went out of our way to help this buyer, and they couldn’t be bothered with keeping on top of the loan, so I won’t feel bad if they don’t get the property; I have a feeling we can make more money if we end up re-marketing it.

As for the two houses that we were scheduled to close on the purchase of, those didn’t happen either…

The Pine House was scheduled to close on December 18, but we’ve obviously missed that date. With the mold continuing to grow in the wet weather, we’ve requested that the seller reduce the price given the delay in closing. We haven’t heard back, but depending on the seller’s answer and when they think we’ll close, we will decide what to do.

The Neighbor House was scheduled to close today, but that’s not happening either. No word on when the closing will actually be scheduled, but my guess is either next week or the following.

So, it looks like our fun, busy week has turned into a frustrating, nothing-much-to-do-except-wait week…oh well, such is this ridiculous business sometimes… 🙂

13 responses to “Disappointing Week”

  1. Ingrid says:

    Oh for crying out loud. Good grief.

    Are you able to keep the deposit for the buyer from the Poor House? I hope so.

    Happy New Year!

  2. J Scott says:

    Ingrid –

    Yup, we would get to keep the deposit on both The Poor House and The Mini House if either/both of them don’t close…it’s a small amount, but better than nothing!

  3. Steve says:

    That is discouraging J Scott! Have you ever tried increased deposits? By day 17 we typically have the buyer remove all contingencies and add an increased deposit to escrow.

  4. Steph says:

    Sorry to hear about your week, J. You know how it goes- when it rains it pours.

    If it makes you feel any better, I had a closing scheduled for today that just got called off at the last minute. Hopefully it will close tomorrow, but you never know.

    Happy Almost New Year!

  5. Aly L. says:

    Sounds like quite a week! I actually feel sorry for the 76 year old man. It’s easy to feel like you’re surrounded by sharks, and to be that age and never having bought a house…understandable.

    But you have to stay in this business to continually inspire the rest of us 🙂

  6. ezra says:


    I really like Steve’s idea. I know you like to keep the initial escrow at $500 to reel em in. But if you are able to increase the escrow the way Steve suggests, you should totally do it since the buyer is already on the hook!


  7. J Scott says:

    Steve (and Ez) –

    I agree this is a fantastic idea, and one that I hadn’t ever really considered.

    From now, this gets added to our selling repertoire…I expect it to help tremendously!

    Thanks Steve!

  8. Brian says:

    My week was also pretty crappy I bought 4 houses at auction, subject to… and the banks decided to neg all of the deals. 🙁

    Hang in there, your blog is great!

  9. Jingle says:

    Wow, something is in the real estate air. I have a HUD house that I was suppose to close on yesterday and now I’m told they are not ready….. I think in my case, it is the end of the year and people aren’t working very much. Hopefully it will turn around for all of us!


  10. Chris Ranney says:

    As a former jewelry store manager I can feel for you about the old man pulling out of the deal at the last second. The other 3 don’t seem so bad. You’re (almost) sure that the second one will close.
    The third one you are renegotiating for a lower price-Yeah! and the last one requires a bit more patience.
    You have had a tremendous year and will have a great 2010. Enjoy tonight with your family and turn that frown upside down ! Peace.

  11. J Scott says:

    Sounds like everyone is dealing with a lot of crap this week…thanks all for the words of encouragement.

    We’ve found that things like this always happen in groups, and you just have to roll with it, and expect everything to work out in the end…

    Good luck, all!

  12. Steve says:

    I will email you our typical counter offer.

    We always take big deposits, a minimum of $5,000 to start, but that is maybe a California thing? With a $2,500 increased deposit and contingency removal, very seldom do we get fall-outs.

    Knock on wood, but I think we’ve canceled two escrows so far…

  13. J Scott says:

    You’re right, Steve…

    The issue arises when the sale price is $90-130K, and the total downpayment (for FHA loans) only amounts to $3-4K. On top of that, most of these buyers are still in the process of saving their downpayments, and are first time home-buyers, so they don’t understand what due diligence means, and are terrified to put all their money into escrow at the beginning of the process.

    Of course, those are just excuses on my part. You’re correct that I need to get more adamant about bigger deposits, and I need start having the buyers increase their deposits after the contingency period (as you suggested earlier). I’m going to start doing that…

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