Title Co Wants to See....

[Tom Medwin]

A written statement from the lender that they know I am reselling the property for profit. I always try to use my title co for double closings. However in this case the end buyer's sister owns a title company. On top of it, the day before his agent brought me a contract she attended a seminar held by First American talking about how flipping short sales is illegal. I doubt that's what they said at the seminar but that's what she took away none the less. So I had to diffuse the situation and educate her about the details of the transaction. She is OK, but still concerned that the lender, OCWEN, is being defrauded because I'm buying from them for one price and reselling for a higher price. She is demanding to do the closing for her brother the buyer and is saying she wants a written statement from OCWEN acknowledging that they are OK with me flipping the property. My purchase contract says plainly on the front page that I have the right to re-market the property on the MLS for profit, but I don't know that that will satisfy her. Anyone know if I'll have any luck asking my negotiator to sign something I send them that says I am reselling the property for profit? If their approval letter doesn't mention the fact that I can't flip the property then I'm clear, but I don't think that will be enough for this title co. My usual title co uses Stewart Title, so I don't know how First American will be with all this. At the end of the day they may still do the deal without such documentation from OCWEN, but she's saying she wants to have it to provide to the underwriter. Ugh, what are the odds that this buyer's sister owns a title company?!

[Dustin Phillips]

Throw it back on her. Ask her to show you where it states that you must provide such a letter. If your purchase agreement states clearly that you will be reselling the property for a profit then that should be the end of the discussion. Call your end buyer and tell them that their sister is jepordizing the deal and that if it does not close it is on her, then explain how the lender would know that the deal is legit, based on the documentaion you provided them...

Sounds like she just wants her brother to think she knows what she is doing, when in fact she is making it worse...