Sale Falls Through Due To Down Payment

Q: My fiancé and I are in the process of buying a house. We met the deadline on getting our financing together in and had no problems.
 

The next morning, the listing broker called our Realtor and said she is refusing our mortgage commitment. As a side note, the listing agent is married to or is somehow related to the owner of the real estate brokerage that is listing the property.

Our Realtor then contacted our attorney and our loan officer and explained that seller's Realtor stated she did not want to accept our mortgage because our down payment is a gift and she doesn't believe we could come up with the funds for the down payment. Our Realtor asked if this was coming from the seller's attorney and the selling Realtor stated the sellers do not have an attorney.

We know that the sellers have accepted a couple of other offers in case our finances fell through. Our attorney got proof of the funds by getting a gift letter and the receipt of deposit of the funds. Our Realtor is planning on writing a letter about the situation to the Realtor's association or something along those lines.

My question is there something we can do as well? Can we write a letter to someone about the situation or should we just leave it up to our Realtor to handle it?

A: What’s probably happening is that the seller has received other offers that are better than the one they accepted from you. They seem to be looking for a way to kill your deal so that they can accept one of these other offices.

You need to know what your rights are under your purchase and sale agreement. You may want to ask your attorney to write the sellers a letter informing them that you are waiving the financing contingency (because you have your financing in order) and are ready to proceed with the purchase of the home. You should also mention that should the sellers fail to sell you the property, you will pursue all legal options available to you.

What you might have done differently is made sure you were approved ahead of time for your financing. Being “preapproved” is different from being “prequalified”. When you’re preapproved, final approval for the loan rests solely on title and making sure the property appraises out in value. Your down payment cash issue would have never come up.

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