Financing Contingencies

You are better off just locking in a long term rate lock, designed for this exact situation, giving you 12 months to secure todays rates. Email me over your contact info and we can discuss on monday. james.mcpartland@wellsfargo.com

Tom,

you should consult your attorney representing you. Not the sellers attorney but your own. You can ask for any kind of financial contingency, but it really depends if the seller will agree to it. If your attorney can't answer and isn't any good, then find another one.

tom - you can ask for any contingency you want. Whether the sponsor will agree to it or not is the question. Another contingency you may want to look into is the FHA or Fannie Mae contingency. Can the sponsor make you close before those approvals are obtained?
But I think if you can for .5% above current market, it's reasonable. I have seen this kind of request several times but a majority of the time it gets turned down. But doesnt hurt to ask.
And the other option is to lock for a longer term. But there are costs involved with long term locks. Although it allows you a 1 time float down within 60 days of closing. Maybe you can negotiate with the sponsor to pay for your long term lock. So you get your guaranteed rate and the sponsor gets the deal without any risk of losing out on the deal later. sunny.hong@bankofamerica.com

Thanks for the advice. I assumed I could try to add any contingency I wanted into the contract, but I was really just curious if this is an unusual request or not.

Sunny, I really like your idea of negotiating with the sponsor to see if he would be willing to pay for the long-term lock. He might be willing to go for that, considering he is likely getting a little desperate to sell a couple more units before the building reaches 51% sold and the FHA and Fannie Mae approvals kick in.

Speaking of attorneys, is it unusual to have to pay for the seller's attorney fees at closing? I was unable to negotiate out of any of the closing costs and was just curious if it is normal to pay for both attorneys.

i wish you well with that request, but i would never agree to that as a seller. you are locking out a unit that could possibly be sold to another while you are asking them to let you out if rates go up with nothing in return. I had no problem getting my mortgage contingency in case i did not get approved, but would not even think of asking to let me out if rates went up to much. This would seem to be a buyer issue and as the mortgage brokers have suggested, you could take money out of your pocket and pay for the rate lock.

put another way if the banks are not willing to lock in your rates for free, why should a developer.

Mikev, maybe because the developer need to sell enough units to get the FHA and Fannie Mae approvals so that everyone can close? No closing means the developer has no money to pay the bank right.

Tom888, before you sign, you can also renegotiate the price to deduct the cost of a longer term lock.