seller's obligation

[Jacob Gildea]

I have an REO property under contract. We were scheduled to close tomorrow, but the bank said that the sherrif's sale deed was not filed yet, so I need to wait until it is. In the mean time my broker tells me that if we don't close the loan tomorrow we will have to file for an extension on the load because interest rates are rising. This would cost me as much as $500 if I extend for a month. My question is should the seller be responsible to pay this? Do I have any options besides terminating the contract? Should I extend the contract? If I do extend for a month and then they deed is still not fixed I lose that money also.

[Matt Sicignano]

Interest rates are not rising, but your rate lock expired. You may have had a 30 day or 45 day lock on the rate. After that it floats. It may even be cheaper now. The seller has no obligation to pay for a rate extension or an extended lock for you, unless it's in the contract (rare). Does the deal make sense? If you can terminate (there was no provision for extending the closing date in the contract) you would lose the appraisal fee. Have you checked the new rate-you may be able to float it at the same or slightly higher. If its a flip, 1/4 point won't mean much!