Escrow has closed but I have not been paid yet?

Question

I am selling my house in CA. Last Wednesday (8/13) I signed all of the paperwork needed on my side, on the understanding that Escrow would close the next day (8/14). The buyer signed their paperwork on 8/14 as per contract. As of today, 8/19 I have *still* not received the funds! At this point the title company says that the lender needs one more piece of paperwork from the buyer but they are now three days over the closing date Is there some penalty or other legal recourse that can be used as leverage with either the title company or the lender?

Answer 1

Sound like Escrow has not closed.  If it did, you would have your money.  Instead, the expected closing date has come and gone without the buyer securing his funding.  This happens (especially with the recent changes in loan laws) and unfortunately there is not much you can do about it except pull out of the deal because the buyer has failed his end.

Answer 2

you need to see the purchase contract.  And you need to get hold

of your agent.

i will agree that the process includes the buyer going to escrow

to sign the note.  Then, the lender sends their check to escrow

who cashes it and at close, gives you their check.

THUS, escrow has NOT closed.  

when you say the buyer signed; does this mean he agreed to the terms from the lender?

ASK YOUR agent to call the lender to see what the hold up is.

it could be simple and it could be a deal buster for the lender.

Answer 3

Nope, nothing you can do.  This happens all the time, just pray that the loan does not fall through, that happens as well.  You will receive your money a few days after the actual close.  Good Luck.

Answer 4

No, you have no recourse or reason to sue.  All the paperwork must be done before closing.  Nobody can guarantee a closing date for exactly the reasons you are encountering now.  All the details must be done correctly and apparently one detail was not so you have to wait.

Answer 5

Unfortunately, thats a commonality of real estate closings. The delay is certainly not the Title Company's fault if the Buyer needs to provide the Lender with additional paperwork.  The real estate companies have tried for years to tie down Lenders to meet or follow the terms of the purchase contract such as a close of escrow date. However they are not a party to the it - so not much you can do about that.  

Answer 6

There are several things that are puzzling to me. You indicated that the buyers had signed their paperwork. I assume that these are the loan docs that are needed to complete their loan.

If this is the case then the lender could very well need additional information from the buyer, it certainly does not  mean that the loan has fell through. This is a normal thing in the mortgage industry. Lenders are always in need of additional information or paperwork.

Your question to your selling agent or escrow closing agent is "Did the loan fund?" The answer to this question will tell you if the lender has sent the funds to the title company.

If they have send the funds or funded the loan they have instructions that the title company must follow. The deeds and notes have to be  recorded properly at the county recorder's office before the transaction can close.

If the loan has not been funded escrow can not close.

No matter what you or anyone do this transaction will not take place until the loan had been funded.

The key for you is to find out if the loan has funded and if not when.

I hope this has been of some use to you, good luck.

"FIGHT ON"  

Answer 7

When buyers and sellers have signed their papers, we say they have "closed".  That is not true.  THe money may not arrive for 7 days.  And it may take 1 more day to get the deed to the Recorders Office.  Then the sale has closed.

THe lender needing one more piece of paper is a huge warning to you. The buyer is not approved for their loan. Doesn't matter if they have signed 100 papers.  They don't have a loan.  Either this is incompetence by the lender or the buyer has been deliberately withholding this "one more piece" because the buyer knows that it is terrible news.  Take the SOLD sign down and get the house back up for sale today. DOn't take any excuses.  Then send a letter to the title company (escrow) by fax saying that the sale "records" by Friday or the sale is cancelled. /