Chris, how can I protect my potential purchase contract if my lender drags his feet and we miss Loan Conditions Deadline. This happened to us in Phoenix and we missed out on a tremendous investment opportunity.
Don’t use a slug for a lender!…OK. This happens more often than we would like it to. As your advocate in this process, I make it a point to watch out for situations like this by keeping in good contact with Lenders and Appraisers. Unfortunatly that does not always do the trick. So- I always write in with any purchase contract containing loan conditions an “Addendum A”. Here in Pagosa Springs we have a standard pre-written addendum (drafted by the lawyers at JSRE, thanks Jimmy).
Section 4 of this addendum states “…If performance is delayed by Buyers Lender…the dates set forth in this contract for Loan Conditions, Approval of Loan Transfer, Appraisel, Survey, Title Deadline, Title Objection Deadline, Closing and Possesion shall be extended 10 business days…”
Simply put, if the lender is slow to perform, everything gets pushed back 10 days automatically. This has salvaged untold transactions for me my and my compadres over the years. This has been especially useful during the firecracker market that Pagosa has experienced in the past 2 1/2 years or so.