Need Immediate Help, closing today

[robcap]

Here is a quick summary of my issue. Seller of property in Jackson, NJ has turned property over to relocation company named Cartus Financial. We signed a contract to buy from Cartus and are headed for closing today. My mortgage company, GMAC is refusing to fund the loan because the Title search came back with the owner of the home being Mr. X (not Cartus( while Cartus is on the HUD-1 and the contract. GMAC is saying that reagrdless of whether there is a contract between MR. X and Cartus and regardless of whether there is a Power of Attorney, Cartus cannot legally sell me the house.

We are supposed to close at 2 PM today and no one will blink on this. Is GMAC correct?

 

[jharris352]

GMAC can make any rules they want to make. The best thing to do is to find out where Mr. X is, get him to endorse the contract and then to sign through the seller's part of the package. You should be able to do what is called a "mail away" if he is in another part of the country.

This is not unsolvable. Are you closing with a title company or an attorney? If you are closing with a title company then it should be easy. You close today the title company overnights the seller's package to their office where ever Mr. x is and he signs tomorrow. GMAC won't have a problem with that.

If you are closing with an attorney, get your attorney to find a "witness" attorney in the other state so that he can over night the package to them.

Good luck. I was in lending and titles for 15 years, I know this seems bogus but I understand why GMAC is doing what they are doing in this instance.

 

[robcap]

the sellers attorney is refusing to allow Mr X to sign the contract claiming they have already paid him for his home and if he signed he would be entitled to the money from us. we tried to get that yesterday but the relo and lawyer are refusing

 

[jharris352]

What a mess. GMAC is going to want their underwriter to see the closing documents where the relo company bought the property. They are worried about a flip where the price to you is significantly higher than the price to Mr. X. Further, they may not close until the relo company has a recorded deed.

If I am understanding you correctly the relo company paid Mr. X for the house and did NOT take title? I can't imagine that is true, they would be stupid to proceed that way. I would think they took title it is just not showing up on the title search yet. If they can provide proof of title to your closing company then they can be added to the title report and the title binder for the title insurance. Then that part of the transaction will be covered and GMAC shouldn't care as long as the price the relo company purchased the property for is within 10% of the price you are purchasing it for or their transaction is 6 months old or more.

Give me more information if you can.

 

[robcap]

Mr X signed the deed and the relo has it, but have not and intend not to enact the deed to them. Thats the hold up. They claim the POA they have from MR X allows them to sell the hosue to me and take the money since Mr X has been paid already by them. Its a mess alright and my wife and 13 month old twins have no where to live in 13 days since we opted out of our existing rental agreement for the home

 

[jharris352]

Well, it is a mess but it is a curable mess. I wish I was your Mortgage Broker I would be on the phone with GMAC working something out. So basically Mr. X signed an open deed. That's an odd ball way of doing things. An open deed is not valid until enacted as you say and recorded. So Mr. X could sell the property again. Now granted he would commit fraud with the relo company if he did.

Someone needs to have a conference call to get everyone on the same page. This isn't a matter of GMAC does not want to do the deal, it is a matter of they don't like the process. So there is some fix to it. I would get the closing attorney, the head of closing for GMAC, and the attorney for the RELO company on the phone and work it out.

Off the top of my head there are three work outs that GMAC would accept or should accept. The relo company taking their place in the chain of title, GMAC being reasonable about a LEGITIMATE relocation company having POA, or (the most complicated and likely scenario) the relocation company putting the deed in escrow with the closing attorney in exchange for a release of funds signed by Mr. X given to the closing attorney. That way, Mr. X can feel comfortable that he is not committing fraud against the relo company, the relo company will know they will get the disbursement from the closing attorney, GMAC will have Mr. X signing the documents because he is officially on title, and you don't give a shit who signs as long as title insurance covers the transaction!

What idiots. Who is handling your mortgage? Your next step is to start informing various people of their liabilities if they do not deliver. But don't start threatening yet.