I recently had the privilege of helping a couple, first-time home buyers, purchase a property where one of those three lenders was not going to make the loan at the 11th hour due to a very minor guideline that one of the borrowers was not able to clear.
These buyers had gotten into a contract with a FinTech company that purchases real estate for cash and then sells the property to the home buyer who agrees to the FinTech company’s onerous requirements. One of these requirements is that the buyer rent back the property until such time as the buyer can secure their financing and purchase the property from the FinTech company.
The looming disaster consisted of this:
- There is a finite amount of time in which the buyer must close on the purchase and each day they go over it was costing the buyer $500/day in increasing rent payments.
- Eventually, if the buyer cannot perform, the buyer would lose their deposit and still have to pay for the closing costs the FinTech company incurred when making the all-cash purchase.
- Not to mention that they would lose the house and have to move out of it!
To make matters worse, the couple was pregnant and due within a few months of the expected closing date.
Luckily they contacted me because they were friends of one of my networking partners, and I was able to get their loan closed in 14 days from the time I took the loan application.
See Fintech: Worst Escrow Experience of My Career for more about that!