Investor · Silver Spring, MD · Member since 2020 · 127 posts · 58 votes
After 8 months and 7 days of waiting for bank approval on a short sale... I'm still waiting. COVID has CERTAINLY not helped but unfortunately, I feel like this is going to make it to the one year mark.
This got me thinking though... What's the longest that any of you have ever been under contract on a property?
LET'S HEAR THOSE SOB STORIES! (Especially if they closed successfully)
We do cash deals, so we normally close in 1 to 2 weeks. One deal took considerably longer due to title issues.
We bought a house at auction (not tax or foreclosure, just a regular auction) and assumed it would be smooth sailing, but no. The land was originally part of a large tract of land (the whole block) owned by a prominent family. In 1964 a portion was donated to the Methodist church, and a house was built for a parsonage. It had never changed hands since.
A few days after our purchase the lady who does our title work stopped in to see us, "There's a problem..."
The property description was wrong. Not only wrong, it made no sense. The original sellers were all deceased, so it couldn't just be corrected. A few years ago their estate sold the rest of the original tract, and the legal description for that sale reads, Beginning at the Southwest corner of [blah, blah, blah] except [parcel deeded to church].
A survey was done, and besides the completely nonsensical property description, in the original plat of that neighborhood, which was never officially changed, the city had planned a street right through the garage. So the title company requested that the city vacate their claim to that strip of land, which they were willing to do, but the man who needed to sign the papers was on vacation, so there was a delay.
Multiple corrected deeds needed to be signed, and several of the people who needed to sign were out of state - more delays. There were questions about the marital state of some of the people who needed to sign. More delays. One of the local signers has a rather mercurial temperament. First she is quite agreeable, then can't be bothered, then contacts the title agent and wants to know why it all hasn't been finished yet. It's difficult to schedule meetings with someone like that, so more delays.
After more than 3 months, it finally closed. Success.
3 months on fha203k loan. Mind you it was 2 moths after original closing date. Im pretty sure it was the lenders first 203k. my first flip. It was one for the books
My longest was 2 and a half years. I bought it on an online auction probably 5 times, they finally must have lowere there reserve price. Then it took about 3 months and I insisted on my title insurance company, and they found a claim for a lien for $7K. I went to the guy to see if he would sell the lien off cheap and he offered to reduce it $100 if I paid cash. A bit snotty about it. The lawyers who did the original foreclosure finally filed a lawsuit to quiet title and got his lien thrown out, a year later. Then they listed it for auction again and I objected and said they still had my $2500 earnest money. After several months they finally sent an email and gave me 72 hours to close. I brought the certified check the next day and bought it. The plan was to put about $80K in it and flip it, the contractor and I were going to do a JV. We hoped to make about $80K on it. Due to the time lapse his schedule was shot for a long time to work on it. I listed it and did a little clean up and sold it owner financed for about a $30K profit in 6 months. It has not closed yet however.
from this post it reminds me of some advice ... "..they always tell us NOT TO MARRY a property but a lot of us seem to date them for a while, hoping to score..." :)
@Thomas Enright I didn't offer again. By this time I had multiple deals under contract and this seller was just a distraction. Another investor I know did put it under contract. The seller tried to back then to raise the price of the deal.
@Pat L. Wow that 10 month one sounds like a nightmare. So why did he put a roof on it? Couldn't you have just ignored his request for more money since he did it on his own and you were already under contract?
@Mary M. Yeah that definitely seems like a good learning opportunity! What kind of buildings are they? SFRs? Plex's? And what was the benefit of doing the buildings separately instead of in one transaction?
@Mike Anderson Haha it's definitely not a competition but I'm sure 3 months wasn't fun to wait. Was the bank just not responding or were they overly complicating everything?
@Stone Saathoff Wow that's an interesting one and that's unfortunate for the seller. Are there any changes to the contract now that the seller is gone? Or is the original agreement going to be honored?
@Thomas Enright It was half way expected since she was 91 years old and already in hospice care. So far we haven't modified the contract, just keep extending the close date until it gets cleared up. The buyer is a very experienced repeat investor and she's moved on to pick up a few more deals from me while this one is on the back burner.
@Aaron Gordy Haha that's good that you made some money on it! I'm planning on doing an FHA 203k loan on the one I'm working on now. I've heard it's a headache. Any advice to make it go smoother whenever I get bank approval on the price?
@Jenning Y. Talk about coast to coast! I just looked at your "Investor from Texas/Florida/California/Utah" and I feel like you should get a deal done on Washinton and New York so that you have the entire US encompassed lol.
@Brian Van Pelt Wow. This definitely isn't a competition but if it was, you'd be in the lead by a couple of years. That definitely sounds complicated but what made it take over 3 years???
@Mike Anderson Haha it's definitely not a competition but I'm sure 3 months wasn't fun to wait. Was the bank just not responding or were they overly complicating everything?
Best I could tell was the bank foreclosed on the home owner, but then never took ownership via some paperwork process. I think the deal was they were trying to avoid paying the county and state tax because it wasn't in their name technically. Then you get the bank and county/state together and the level of efficiency drops to somewhere around -387% because of how amazing these sort of organizations are run so next thing you know it's 3 months later. We were about to walk away as we needed a place to live. Suddenly it all got fixed magically and we closed.
@Thomas Enright there just so many moving parts, I would make sure the lender is doing their job lol and get a contractor that has gone through it before. I had a pretty good contractor on mine, there were extra inspections and appraisals. The appraiser wanted a bunch of extra work done that wasn’t originally on the bid so everything had to be revised 2 or 3 times. The guy for fha that did his inspection was from Colorado and was the only one available so I had to wait forever until he could fly to Minnesota to do the inspection. It was just one thing after another lol.
@Jerry W. Dang, 2.5 years... That's funny that the lienholder wouldn't budge really and then it just got thrown out. Did you hear anything from him after that? I'm sure he felt like he messed up. And that's super messed up that they tried to list if for sale again after you had already agreed to buy it several times and they were still holding your deposit. And couldn't you have found a different contractor?
@Mike Anderson Whoa yeah I can't even imagine how inefficient that whole process would be. That's a good thing that it worked out though! Do you still have that property?