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Aaron N. Tubbs

Dragon chaser.

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So last night we get a call from our realtor — “The buyer is still trying to find a home and they want more flexibility; they want a 90-day close.” Still upset about the whole bid getting raised thing because we gave them a “night to think it over” we don’t feel like being real flexible right now.

On the other hand, it’s a seller’s market, maybe we don’t have a choice.

Now, at the end of the day, whether we close in 60 days or 90 days is not real important right now, because our lease will not have yet expired in either situation.

However, there’s a little subtlety to the 30 additional days in terms of locking in mortgage financing — we’d get a quarter point rate hike. By my back-of-the-envelope (which is to say I’ve ripped out the HP 12C) calculations, that means another $30-40 a month, or in more terrifying terms another $10,000 to $20,000 in interest over the life of the loan. So when the seller says that they want a 90-day close rather than a 60, they’re effectively raising our bid by a decent chunk (NB this is not true in the strictest sense, since this will do nothing to our principal, and there is the tangible benefit of the tax write-off … but at the end of the day, more money would be flowing out of our pockets never to come back).

So our real estate agent didn’t really seem to be putting much effort to get that point across (though again, maybe I give her too little credit, and in a seller’s market she has no power, and I’m just having too high of an expectation). The seller’s agent brought up the idea of a lease-back for a month after closing, but our agent pointed out that there’s no way that either our lawyer or our bank would allow that. Then the mortgage broker suggested that it might be possible to close, but delay move-in for 30 days after the close, but as Sarah pointed out “how is that any better than a lease-back?” In fact, all I could imagine is that it would be worse, as it would require some pretty nasty contracts and legal fooling since there would not be a physical handover of the property at closing, which sounds shady to me. Either way they’re all chatting this morning, but at the end of the day it’s a big mess, and I have no idea how it’s going to work out in the end.

Update: Apparently the mortgage broker will look the other way, and the lawyer says it’s easy to do, and keep us safe, and is done all the time. So we’re back in it again….