Several years ago, a client was selling their home, and the bottom line wasn't pretty, they were going to have to bring 5000.00 to closing, however, there was over 5,000.00 in their escrow account which they could not get back for 30 days.
This didn't seem right to me, so I contacted the lender on the seller's behalf and asked if the loan payoff could include the deduction of the escrow account, allowing the seller the expense of borrowing the money to come to closing to just sell their house.
The process was simple (well, 15 years ago it was simple). All the seller had to do was write a letter to the lender requesting the escrow be included in the payoff for the day of closing.
It saved the seller a lot of frustration, the sale closed, and we saved the day.
I have run into this situation again, and today it is not so easy, the lender swears on their Mothers grave, it can't be done, "not our Policy" "Can only do it for refinance". After 45 minutes of informing the lender that yet another foreclosure may hit the market if this cannot be accomplished, they said if the seller wrote a hardship letter, within three days they "may" be able to get it approved. Thing is, the seller had sent that letter three weeks early and had been declined in writing.
The Title company spent hours trying to reason with someone, anyone, to get this done, and after three weeks, several days, too many hours, and a boat load of frustration, it may get done.
I sent a letter to my Congressman, and I will contact whomever I think may have an impact on this ridiculous rule.
Sellers are giving up on the ludicrous behavior of banks and lenders that do not have real world issues in their vocabulary, result, millions of foreclosures that could have been saved. This story is just one of the reasons the public has lost trust in anyone who was once a savior to the American Dream.
If you are faced with this situation, fight for your Money. It may not be much, but in this market we only have a few angles to cover.
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