You included, in the two paragraphs preceding that one:)
Or were you agreeing with me in a professional capacity?
No, it does not work that way, you are confusing this with an easement or use restriction etc. which can attach to the deed post sale. ROFR is one time use until the decision point is triggered. How would you imagine an option to purchase is going to last past sale of the property to the non-ROFR buyer?
Ah, the elusive Right of Second Refusal.
The closing was supposed to happen tomorrow.
A little while ago, Mary Lou texted me, “The new date is June 30.”
WTF??
After talking with Mary Lou, this is what I have gleaned in bits and pieces. Ernie finally signed the waiver on the ROFR today. Now the buyers Bob & Joe Smith are saying they want to delay the closing until June 30, that because Ernie had not signed the ROFR, their financing was not ready to go, so they need another two weeks to get it together. (This makes NO sense to me.)
Mary Lou’s realtor has said to Bob & Joe that they must now pay an additional $5,000 earnest money as a penalty for the delay. (They had already paid $5,000.) I say, what if they refuse?
None of this makes any sense. If Bob & Joe have their financing ready, why would they pay an additional $5K AND delay further? They know what they want to do with the building and they’re delaying their own process, too.
There is still a chance Bob & Joe might call the realtor today and say they want to go ahead with the closing tomorrow. One can only hope.
Long ago I ceased to be amazed at how apparently disorganized simple RE closings could be, and how closing dates and such were merely “targets.” Can drive you nuts, when everyone acts as tho things will just magically coalesce at some future date, you can’t imagine what would possibly be holding things up, and there is NOTHING you can personally do to move things along.
Sounds like she has a good lawyer on her side, which is about all you can do. Thanks for checking in, and hope things work out.
Simple, the lender was not going to finish processing the financing until it was clear that the contemplated transaction was going to go through. The buyers don’t want to delay the process, the lender requires time to finish processing the financing now that the property is not subject to Ernie’s ROFR.
About the extra $5000 earnest money: The seller/seller’s attorney wants a firmer commitment that the buyers are serious about following through on the purchase, since they don’t have their financing ready and are delaying closing. If the buyers tell the seller to go pound sand, the seller can decide either to withdraw the requirement for more earnest money and accept the later closing date, or walk away from the deal (assuming their are appropriate contingencies etc. to let them do that). Or, if they are literal minded, they could drag a sledgehammer to a sandbox and begin pounding, but to what end I don’t know.
Note that the buyers aren’t spending an additional $5000, they are just increasing how much they are putting up before closing. It will be credited towards the agreed upon purchase price at closing.
There is no chance that the buyers will call and say they actually do want to close tomorrow, unless they don’t require financing to complete the purchase. The lender is causing the delay at this point.
Why doesn’t it make sense? Mortgage loans are large and complicated, and the bank (or other lender) takes a long time to process them, and don’t start that time consuming process until the sale is ready to go. If they know the sale can’t legally proceed, they’re not going to start processing the loan until someone confirms to them that there’s an actual legal sale in progress. Where I am, realtors expect most sales to get delayed at least once by part of the mortgage process whether it’s the approval, appraisal, or something else, and buyers have to be prepared to dig up obscure documents on short notice.
The earnest money goes towards buying the house if the deal goes through, so she’s not really asking for them to pay an additional $5k for the property. What she’s really asking them is to put another $5k in the ‘you get this money if we back out of the deal’ pool. If they balk at this point, then they’re out the $5k (or however much) earnest money they’ve already put in), so they’re unlikely to just back out of the deal over this.
They’re not going to be able to close unless they can pay, and expecting a bank to approve a mortgage in a day is… more than optimistic. Real estate closings get moved back all the time because there are so many different actors and steps involved, it’s generally not anything to worry about.
Because I don’t understand the process very well, which is why I’m here asking questions.
Thanks, y’all.
SHE CLOSED TODAY!! YAY!!
By some miracle, the buyers were all ready to go today. It’s done. Bring on the champagne!
Unless someone ninjas me, let me be the first to say, “Congradulations [sic]”! Misspelling intentional, because I like it.
Thank you. Just had a long phone convo with Mary Lou-- planning our celebratory lunch.
Congratulations! (to your friend/ family) and thanks for keeping us updated.