[WSBARP] Anti-Bank Rant of the Day

[Kyle Nolte]

And….

 

Fannie Mae has just started including an “Amendment” concerning release of
the financing contingency, and is requiring all Buyers to sign as soon as
the Buyer has qualified for financing. 

The Amendment immediately releases the earnest money to the Seller (Fannie
Mae). 

In my case, the unsophisticated Buyer had no problem qualifying for a loan
so she signed the Amendment.

Subsequently, an inspection report found that the property required
several minor repairs, which Fannie Mae refused to make.

Buyer’s lender refused to loan money on the property without the repairs
and so, the transaction failed.

Citing their new Amendment, Fannie Mae is refusing to return the client’s
earnest money deposit.

According to both brokers involved in the transaction (who actually picked
up the phone and called Fannie Mae and complained about the new
Amendment), Fannie Mae is now doing this nationwide. 

Apparently their asset managers believe this is a fool-proof way of
keeping the earnest money deposit in every transaction, regardless of
whose actions terminate the deal.


 

We shall see….

 

If anyone else has dealt with this new Amendment and prevailed, please let
me know.

 

Kyle

 


 

 



KYLE W. NOLTE
Attorney at Law

TEL. 509.326.4800
FAX 509.326.4891
www.stamperlaw.com


720 West Boone • SUITE 200 • Spokane, WA 99201

 

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From: wsbarp-owner at lists.wsbarppt.com
[mailto:wsbarp-owner at lists.wsbarppt.com] On Behalf Of Eric Nelsen
Sent: Monday, March 24, 2014 4:38 PM
To: WSBA Real Property listserve (wsbarp at lists.wsbarppt.com)
Subject: [WSBARP] Anti-Bank Rant of the Day

 

Reviewing closing documents for a Buyer in a residential purchase. Lender
has an interesting new "Document Correction Agreement" that says "If any
document is lost, misplaced...Borrower will...execute any documentation
Lender deems necessary to replace..." the lost documentation...including a
new Promissory Note. (They do so-kindly say they'll indemnify for the lost
Note.) And of course the Lender's mere request "shall be prima facie
evidence of the necessity for the same." And "failure to deliver
replacement documents can constitute a default," so they'll foreclose on
you if you balk. And borrower agrees to be liable to the bank for all the
bank's damages if borrower refuses to actually comply when the bank comes
to them and says "uhhh...we lost the paperwork, please sign these
replacements."

 

THIS is the industry response to being totally incompetent at their job
for multiple years and precipitating a worldwide economic crash? The banks
can't keep track of their own records, but instead of cleaning up their
own houses, they introduce a new requirement for the borrower to do it for
them, and take all the risk of them losing the paperwork again???

 

Sincerely,

 

Eric C. Nelsen

SAYRE LAW OFFICES, PLLC

1320 University St

Seattle WA  98101-2837

phone 206-625-0092

fax 206-625-9040

 

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